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Tree roots from neighboring homeowners association invaded my property and did damage to my pool. Their insurance company accepted liability but wants to deduct 10% depreciation costs from claim payout. Can they do this? What are guidelines for determining 10%? I had lifetime structural warranty on my pool that was compromised by tree roots.

2 Thoughts on How is depreciation value determined?
  1. Reply
    June 27, 2012 at 1:26 am

    Well, you can just tell them no. Me, I think they’re pulling it out of the air. You have a LIFETIME structural warranty. They DO have a root issue – although in most courts, as soon as the roots go on to your property, it’s YOUR problem (so I’m a bit surprised they’re accepting liability).

    But IF they’ve accepted it, and you have that in writing, NOW the only issue is the dollar amount – and if it were me, I’d tell them, hey, I have a lifetime structural warranty, and expect 100% of the damage payment, and if you don’t like it, see you in court – liability isn’t in question, we’re just haggling over the dollar amount. And I expect they’d pay it.

  2. Reply
    Dion J
    June 27, 2012 at 2:07 am

    Depreciation is a deduction for the value an item has lost due to it’s age or use. For example, if an item normally lasts 10 years, depreciation would be calculated at 10% per year, based on its age.
    On a liability claim (I am surprised that they accepted liability for tree roots), the neighbors insurance company does not owe you full replacement cost.
    The fact that there was a warranty on the pool is completely irrelevant.

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