Hello, My question is in regards to claim payments. We had hail claims in May and June of 2020 and have made ACV payments for the damages. We have holdback available for replacement cost coverage HO-3 policy form HO 00 03 05 11. With the dramatic increase in building materials and labor, do we owe the extra costs or the cost at the time of loss? Some claims have more than doubles in cost. Thank you!

South Dakota Subscriber

The policy states that once repair is completed it will pay no more than the least of the limits of the policy, cost to repair or replace with like kind and quality, or the amount actually spent to repair or replace damaged property. (emphasis added). This indicates that whatever the cost is at the actual time of repair, not the date of loss, is what is paid out. Nothing in the policy ties payment to costs that existed at the time of the loss; payment is made when it is made, at the going costs at the time.