Insurers May Depreciate Labor Costs When Calculating Actual Cash Value, Neb. High Court Rules

OMAHA, Neb. — An insurer may depreciate labor costs when calculating actual cash value where the terms “depreciation” and “actual cash value” are not defined in the policy, the Nebraska Supreme Court has ruled in answering a certified question.

In a Feb. 17 opinion, the state’s highest court reasoned that “payment of the full amount of labor” in an actual cash value payment “would amount to a prepayment of benefits to which the insured is not yet entitled.”

In September 2011, Rosemary Henn submitted a homeowner’s claim for damage that occurred to her home’s roof vent caps, gutters, siding, fascia, …