Among the basic rules of insurance are these two: (a) always
read your policy and (b) courts will construe clear and unambiguous
insurance policy language by giving it its ordinary and plain
meaning. This is the lesson that a policyholder learned after
filing a claim for windstorm damage to his roof. The question was
whether the policy provided actual cash value or replacement cost
damages.
In Richelson v. Liberty Insurance Corp.,
No. 19-3035 (6th Cir. Jan. 6, 2020) (Not Recommended for Full-Text
Publication), the Sixth Circuit affirmed the district court’s
grant of an insurance company’s motion to dismiss a
policyholder’s breach of contract and fraud claims. A
windstorm caused damage to the policyholder’s roof and the
policy filed a claim for replacement cost damage under his
homeowner’s policy. The insurance company reimbursed the
policyholder only for actual cash value, applying the
policy’s deductible and deducting depreciation from the
replacement cost amount.
