A homeowner's roof is 15 years old and suffers hail damage. The adjuster values the damaged roof at $20,000 replacement cost and determines 50% depreciation based on age and condition. The homeowner has an RCV policy. How much is paid?

RCV HOMEOWNERS CLAIM — RECOVERABLE DEPRECIATION: Step 1: Adjuster pays ACV first: $20,000 - $10,000 depreciation = $10,000 (minus deductible); Step 2: After the roof is repaired or replaced, the insured submits receipts; Step 3: Insurer releases the recoverable depreciation: $10,000 additional (minus deductible if not already applied); Total recovery: $20,000 minus the deductible; PURPOSE: The two-step payment incentivises actual repair — the insured can't pocket the depreciation without making the repair; ADJUSTER PROCESS: Explain the RCV process at first notice; issue the initial ACV payment promptly; track the file for receipt of repair documentation; issue recoverable depreciation promptly once repairs are substantiated; COMMON CONFUSION: Many insureds expect the full $20,000 immediately — clear communication about the RCV process prevents disputes.