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Trying to understand how Home Insurance works. Any help is appreciated.

My laminate basement flooded and now, the insurance company will be paying for a new floor. I am trying to understand the financials here.

Say it costs $10k to put in a new vinyl floor and $2k is my deductible. Does the insurance company pay for the remaining $8k completely?

I am guessing no, since the agent mentioned that the water damage mitigation expert will be sending a sample of the floor to the lab for them to determine the current damaged floor value.

The agent also mentioned something about depreciation which went over my head. She said the value is determined by checking the market cost of installation of a like-for-like floor minus depreciation.

So if the exact same laminate floor new installed costs $6k and we subtract $1k for depreciation, will the insurance company be paying me 3k which is 6k minus 1k (depreciation) minus 2k (deductible)?

If I go for the $10k vinyl floor, do I have to bear the extra $4k myself?

submitted by /u/RudraAkhanda
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source https://www.reddit.com/r/RealEstate/comments/12zfqjn/trying_to_understand_how_home_insurance_works_any/
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