Depreciated Cost or depreciated value

The depreciated cost or depreciated value of an item is the cost to reproduce or replace the damaged property, less the annual depreciation due to use and wear. If the customer chooses depreciating value for their valuation choice, claims for damage will be settled like an automobile claim. This type of valuation assumes that as an item is used day to day, its value is reduced proportionately. If an item is damaged during a move, its value is based on the residual value of the item, not on its value when it was new. Arpin of RI suggests FVR (full value replacement) as the best valuation choice. It is a little more expensive but fully reimburses customers for severely damaged items. With FVR valuation, if an item is damaged beyond repair, it will be replaced with a new item of similar quality.