Insurance Claim Calculator

Insurance Claim Payout Calculator

Estimate your potential insurance payout and out-of-pocket costs.

Enter 0 for Replacement Cost Value (RCV) policies.

function calculateClaim() { var estimatedDamageCost = parseFloat(document.getElementById('estimatedDamageCost').value); var policyDeductible = parseFloat(document.getElementById('policyDeductible').value); var policyCoverageLimit = parseFloat(document.getElementById('policyCoverageLimit').value); var depreciationRate = parseFloat(document.getElementById('depreciationRate').value); if (isNaN(estimatedDamageCost) || isNaN(policyDeductible) || isNaN(policyCoverageLimit) || isNaN(depreciationRate)) { document.getElementById('totalDamageOutput').innerText = 'Please enter valid numbers.'; document.getElementById('depreciatedValueOutput').innerText = "; document.getElementById('yourOutOfPocketOutput').innerText = "; document.getElementById('insurancePayoutOutput').innerText = "; return; } if (estimatedDamageCost < 0 || policyDeductible < 0 || policyCoverageLimit < 0 || depreciationRate 100) { document.getElementById('totalDamageOutput').innerText = 'Please enter non-negative values. Depreciation rate must be between 0-100%.'; document.getElementById('depreciatedValueOutput').innerText = "; document.getElementById('yourOutOfPocketOutput').innerText = "; document.getElementById('insurancePayoutOutput').innerText = "; return; } // Step 1: Calculate damage after depreciation (Actual Cash Value – ACV) var damageAfterDepreciation = estimatedDamageCost * (1 – depreciationRate / 100); // Step 2: Amount after deductible is applied to the depreciated value var amountAfterDeductible = damageAfterDepreciation – policyDeductible; // Step 3: Apply policy coverage limit var insurancePayout = Math.min(amountAfterDeductible, policyCoverageLimit); // Step 4: Ensure payout is not negative insurancePayout = Math.max(0, insurancePayout); // Step 5: Calculate your out-of-pocket cost // This includes the deductible, any depreciation, and any amount exceeding the policy limit. var yourOutOfPocket = estimatedDamageCost – insurancePayout; document.getElementById('totalDamageOutput').innerText = '$' + estimatedDamageCost.toFixed(2); document.getElementById('depreciatedValueOutput').innerText = '$' + damageAfterDepreciation.toFixed(2); document.getElementById('yourOutOfPocketOutput').innerText = '$' + yourOutOfPocket.toFixed(2); document.getElementById('insurancePayoutOutput').innerText = '$' + insurancePayout.toFixed(2); }

Understanding Your Insurance Claim Payout

Navigating an insurance claim can be complex, but understanding how your payout is calculated can help you set realistic expectations. This calculator helps you estimate the potential payout from your insurance company and your own out-of-pocket expenses based on common policy terms.

Key Factors in Your Claim Calculation:

1. Estimated Total Damage/Repair Cost

This is the total cost to repair or replace the damaged property or item. It's crucial to get an accurate estimate from a qualified professional. This figure forms the baseline for your claim.

2. Your Policy Deductible

The deductible is the amount you are responsible for paying out of pocket before your insurance coverage kicks in. For example, if you have a $1,000 deductible and your approved claim is $10,000, the insurance company will pay $9,000, and you pay the first $1,000.

3. Policy Coverage Limit

Every insurance policy has limits, which are the maximum amounts your insurer will pay for a specific type of claim or for the entire policy period. If your damage exceeds this limit, you will be responsible for the difference, even after your deductible is met.

4. Depreciation Rate (Actual Cash Value vs. Replacement Cost Value)

This is a critical factor, especially for older items or property. Insurance policies typically fall into two categories regarding depreciation:

• Actual Cash Value (ACV): This type of policy pays for the cost to replace damaged property minus depreciation. Depreciation accounts for the age, condition, and obsolescence of the item. For example, if your 10-year-old roof is damaged, an ACV policy would pay for a 10-year-old roof, not a brand new one. The depreciation rate in the calculator applies to ACV policies.
• Replacement Cost Value (RCV): This policy pays for the cost to replace damaged property with new property of similar kind and quality, without deduction for depreciation. If you have an RCV policy, you would enter '0' for the depreciation rate in the calculator. Often, RCV policies pay an initial ACV amount, and then the depreciation amount is paid out once repairs are completed and proof of replacement is provided.

How the Calculator Works:

The calculator first determines the "depreciated claim value" by applying the depreciation rate (if any) to your estimated damage cost. From this depreciated value, your deductible is subtracted. Finally, the policy coverage limit is applied to ensure the payout does not exceed your maximum coverage. Your "out-of-pocket cost" includes your deductible, any amount lost due to depreciation, and any portion of the damage that exceeds your policy's coverage limit.

Example Scenario:

Let's say your home suffers $15,000 in damage. Your policy has a $1,000 deductible and a $25,000 coverage limit for this type of damage. If your policy is ACV and applies a 10% depreciation rate:

• Estimated Damage: $15,000
• Depreciation (10%): $1,500 ($15,000 * 0.10)
• Depreciated Claim Value: $13,500 ($15,000 – $1,500)
• After Deductible: $12,500 ($13,500 – $1,000)
• Insurance Payout (after limit check): $12,500 (since $12,500 is less than the $25,000 limit)
• Your Out-of-Pocket: $2,500 (This includes your $1,000 deductible + $1,500 due to depreciation)

Use this calculator as a guide to better understand your potential claim outcome, but always consult your insurance provider for exact policy details and claim processing.