§ 38.2-2119. Approval of forms or provisions for certain risks.
A. The Commission may approve and authorize the use of appropriate forms orprovisions for supplemental contracts or extended coverage endorsements wherethe insured may be indemnified for (i) the difference between the actual cashvalue of the property at the time of loss and the cost of repair orreplacement of the property on the same site with new materials of like kindand quality, within a reasonable time after the loss, and without deductionfor depreciation, (ii) additional cost or loss by reason of any ordinance orlaw in force at the time of loss which necessitates the demolition of anyportion of the insured property, (iii) any increased cost of repair orreplacement by reason of any ordinance or law regulating construction orrepair of the insured building, and (iv) loss from interruption of business,untenantability, or termination of leasehold interest because of damage to ordestruction of the property described in the policy. These forms orprovisions shall apply to coverage provided to an insured having any interestin an insured building or structure which is a part of the building describedin the policy, including service equipment for the building.
B. Where any policy of insurance issued or delivered in this Commonwealthpursuant to this chapter provides for the payment of the full replacementcost of property insured thereunder, the policy shall permit the insured toassert a claim for the actual cash value of the property without prejudice tohis right to thereafter assert a claim for the difference between the actualcash value and the full replacement cost unless a claim for full replacementcost has been previously resolved. Any claim for such difference must be madewithin six months of (i) the last date on which the insured received apayment for actual cash value or (ii) date of entry of a final order of acourt of competent jurisdiction declaratory of the right of the insured tofull replacement cost, whichever shall last occur.
C. Notwithstanding the provisions of § 38.2-2104, insurers may offer, as anoption, coverage limited to the amount necessary to repair or replace damagedproperty with functionally equivalent property at a lower cost than would berequired to repair or replace the damaged property with material of like kindand quality. Such policies may also permit, at the option of the insured,settlement based on the market value of the damaged property at the time ofloss. No new policy or original premium notice of insurance covering propertyinsured on a functional replacement cost basis shall be issued or deliveredunless it contains the following statement printed in boldface type, orunless the statement is attached to the front of or is enclosed with thepolicy or premium notice:
Important Notice
The coverage under this policy applies on a functional replacement cost basiswhich means that, under certain conditions, claims may be settled for lessthan the actual cash value of the property insured.
(Code 1950, § 38-190; 1950, p. 995; 1952, c. 317, § 38.1-374; 1986, c. 562;1992, c. 762; 1996, c. 373.)
§ 38.2-2119. Approval of forms or provisions for certain risks.
A. The Commission may approve and authorize the use of appropriate forms orprovisions for supplemental contracts or extended coverage endorsements wherethe insured may be indemnified for (i) the difference between the actual cashvalue of the property at the time of loss and the cost of repair orreplacement of the property on the same site with new materials of like kindand quality, within a reasonable time after the loss, and without deductionfor depreciation, (ii) additional cost or loss by reason of any ordinance orlaw in force at the time of loss which necessitates the demolition of anyportion of the insured property, (iii) any increased cost of repair orreplacement by reason of any ordinance or law regulating construction orrepair of the insured building, and (iv) loss from interruption of business,untenantability, or termination of leasehold interest because of damage to ordestruction of the property described in the policy. These forms orprovisions shall apply to coverage provided to an insured having any interestin an insured building or structure which is a part of the building describedin the policy, including service equipment for the building.
B. Where any policy of insurance issued or delivered in this Commonwealthpursuant to this chapter provides for the payment of the full replacementcost of property insured thereunder, the policy shall permit the insured toassert a claim for the actual cash value of the property without prejudice tohis right to thereafter assert a claim for the difference between the actualcash value and the full replacement cost unless a claim for full replacementcost has been previously resolved. Any claim for such difference must be madewithin six months of (i) the last date on which the insured received apayment for actual cash value or (ii) date of entry of a final order of acourt of competent jurisdiction declaratory of the right of the insured tofull replacement cost, whichever shall last occur.
C. Notwithstanding the provisions of § 38.2-2104, insurers may offer, as anoption, coverage limited to the amount necessary to repair or replace damagedproperty with functionally equivalent property at a lower cost than would berequired to repair or replace the damaged property with material of like kindand quality. Such policies may also permit, at the option of the insured,settlement based on the market value of the damaged property at the time ofloss. No new policy or original premium notice of insurance covering propertyinsured on a functional replacement cost basis shall be issued or deliveredunless it contains the following statement printed in boldface type, orunless the statement is attached to the front of or is enclosed with thepolicy or premium notice:
Important Notice
The coverage under this policy applies on a functional replacement cost basiswhich means that, under certain conditions, claims may be settled for lessthan the actual cash value of the property insured.
(Code 1950, § 38-190; 1950, p. 995; 1952, c. 317, § 38.1-374; 1986, c. 562;1992, c. 762; 1996, c. 373.)
§ 38.2-2119. Approval of forms or provisions for certain risks.
A. The Commission may approve and authorize the use of appropriate forms orprovisions for supplemental contracts or extended coverage endorsements wherethe insured may be indemnified for (i) the difference between the actual cashvalue of the property at the time of loss and the cost of repair orreplacement of the property on the same site with new materials of like kindand quality, within a reasonable time after the loss, and without deductionfor depreciation, (ii) additional cost or loss by reason of any ordinance orlaw in force at the time of loss which necessitates the demolition of anyportion of the insured property, (iii) any increased cost of repair orreplacement by reason of any ordinance or law regulating construction orrepair of the insured building, and (iv) loss from interruption of business,untenantability, or termination of leasehold interest because of damage to ordestruction of the property described in the policy. These forms orprovisions shall apply to coverage provided to an insured having any interestin an insured building or structure which is a part of the building describedin the policy, including service equipment for the building.
B. Where any policy of insurance issued or delivered in this Commonwealthpursuant to this chapter provides for the payment of the full replacementcost of property insured thereunder, the policy shall permit the insured toassert a claim for the actual cash value of the property without prejudice tohis right to thereafter assert a claim for the difference between the actualcash value and the full replacement cost unless a claim for full replacementcost has been previously resolved. Any claim for such difference must be madewithin six months of (i) the last date on which the insured received apayment for actual cash value or (ii) date of entry of a final order of acourt of competent jurisdiction declaratory of the right of the insured tofull replacement cost, whichever shall last occur.
C. Notwithstanding the provisions of § 38.2-2104, insurers may offer, as anoption, coverage limited to the amount necessary to repair or replace damagedproperty with functionally equivalent property at a lower cost than would berequired to repair or replace the damaged property with material of like kindand quality. Such policies may also permit, at the option of the insured,settlement based on the market value of the damaged property at the time ofloss. No new policy or original premium notice of insurance covering propertyinsured on a functional replacement cost basis shall be issued or deliveredunless it contains the following statement printed in boldface type, orunless the statement is attached to the front of or is enclosed with thepolicy or premium notice:
Important Notice
The coverage under this policy applies on a functional replacement cost basiswhich means that, under certain conditions, claims may be settled for lessthan the actual cash value of the property insured.
(Code 1950, § 38-190; 1950, p. 995; 1952, c. 317, § 38.1-374; 1986, c. 562;1992, c. 762; 1996, c. 373.)
