How to read a depreciation schedule from your insurer

What is a depreciation schedule?

After a contents claim, your insurer sends a spreadsheet or PDF listing each item they've priced. Some call it a contents estimate, a statement of loss or a personal property worksheet. Whatever the name, it does the same job: it turns your list into money, one line at a time.

Every line starts from what the item would cost to buy new today and then subtracts depreciation, the value an item loses with age and use. The totals at the bottom are what the insurer plans to pay. They are worked out, line by line, from choices someone made, so they can be checked.

What does each column mean?

Layouts differ between insurers and the software they use, but most schedules carry these columns in some order:

• Line or item number. The reference to quote when you ask about a line.
• Description and quantity. What they think the item is, and how many.
• Age. How old they've recorded the item as, usually in years.
• Condition. Often average, good or poor. A worse condition can mean more depreciation.
• Life expectancy. How many years they expect that kind of item to last.
• Replacement cost. The price of a new equivalent, sometimes with sales tax shown separately. See replacement cost.
• Depreciation. The amount taken off, sometimes shown as a percentage too.
• Actual cash value. Replacement cost minus depreciation: what the item was worth used. See actual cash value.

How is the depreciation worked out?

Most schedules divide the item's age by its life expectancy and apply that share to the replacement cost. Some cap the total, and some adjust for condition. Here is the common straight-line version on one line:

Insurers use their own tables for life expectancy, and they aren't the same everywhere. If a figure looks short for the kind of item it is, ask your adjuster which table they used.

Which depreciation do you get back?

On a replacement cost policy, much of the depreciation on the schedule is money held back until you replace the item, not money lost. Some schedules mark that amount as recoverable, sometimes by putting it in brackets or a separate column. Our guide to getting recoverable depreciation back covers how to claim it.

On an actual cash value policy, the depreciation usually isn't paid later. Your policy's loss settlement section says which kind you have, and the schedule's summary often says it too.

What to check on every line

1. Is the item described correctly? A 65-inch television priced as a 40-inch one is a common kind of slip.
2. Is the quantity right? Sets, pairs and multiples are easy to record as one.
3. Is the age right? Compare it with your receipt, order email or bank statement.
4. Is the replacement price a fair match for the brand and quality you owned?
5. Does the life expectancy make sense for that kind of item?
6. Is anything from your list missing from the schedule altogether?

Mark each line you disagree with and note what you think it should say and why. You don't need to challenge every line, only the ones that are wrong.

What if something is missing from the schedule?

Compare the schedule with the list you sent, item by item. Things drop off when a list is retyped, when two similar lines are merged, or when a photo was hard to read. Send the missing items back with their line from your own list and whatever proof you have.

The schedule can usually be revised more than once while the claim is open, so an item you remember later can still be added. Ask your adjuster how they want additions sent, and keep a copy of each version you receive so you can see what changed.

Where do the totals come from?

The bottom of the schedule adds up the lines, then usually subtracts your deductible and any amount already paid. Check the arithmetic, check which deductible was used, and check whether any category has hit a limit. The first payment is usually the actual cash value total less the deductible. The rest is what may come later.

How do you question a line?

Write to your adjuster rather than calling, so there is a record. List the line numbers, say what you think each should be, and attach the proof: a receipt, an order email, a photo, or a link to a comparable item on sale now.

• Ask them to explain how they worked out the depreciation on any line you question.
• Ask for the schedule as a spreadsheet if you only have a PDF. It's much easier to check.
• Keep your tone plain and specific. Adjusters change lines all the time when shown a clear reason.

If you still can't agree on the amount, many policies have an appraisal clause for exactly that, and every state has an insurance department that takes consumer questions. Check your policy for the process that applies to you.

Where Indemnia helps

Upload your insurer's schedule and Indemnia lines it up against your own inventory. It shows each line's depreciation, flags ages and prices that don't match your receipts, and lists the items that are missing, so you know which lines to ask about.