HO 04 90: Personal Property Replacement Cost Explained

HO 04 90 changes how a homeowners policy settles covered losses to eligible personal property. Instead of permanently deducting depreciation through actual cash value, the endorsement can pay replacement cost when its repair-or-replacement conditions are met. It does not remove the deductible, increase the Coverage C limit, or turn an uncovered cause of loss into a covered one.

What does HO 04 90 change?

Without replacement-cost treatment, personal property is commonly settled at actual cash value, which accounts for age and condition. HO 04 90 changes eligible Coverage C property to replacement-cost loss settlement. A current sample policy reproduces HO 04 90 03 22 and identifies eligible property, ineligible property, and the settlement condition.^[1]

The form can also address awnings, outdoor antennas and equipment, carpeting, and household appliances when the policy covers them. Certain separately scheduled items can qualify when they are not already subject to agreed-value settlement. The actual form and schedule control.^[2]

Which property does not receive replacement cost?

The current standard endorsement keeps several categories on actual cash value. These include antiques and fine art that cannot be replaced, memorabilia and collectibles whose age or history contributes to value, property not maintained in good working condition, and outdated or obsolete articles kept in storage.^[1]

That distinction avoids treating a unique historic object like a newly purchased household item. Separately scheduling valuable property may provide different valuation options, but it is not automatic.

How does a claim get paid?

The policy first determines whether the cause of loss and property are covered. The deductible, Coverage C limit, and any special sublimits still apply. The endorsement then measures the least applicable amount under its repair, replacement, and limit rules.

If the insured has not repaired or replaced the property, the insurer may initially settle at actual cash value and release additional replacement-cost benefits after the work or purchase is completed within the required period. Keep an inventory, photographs, receipts, and replacement invoices. Ask the adjuster for the deadline and documentation requirements in the issued edition.

This guide is for educational purposes and summarizes standard ISO policy concepts in original language. Form numbers and titles are used only for identification. Menlo Insurance Services is not affiliated with or approved by Insurance Services Office, Inc. Your policy, declarations, and attached endorsements control. Talk to a licensed agent about your property.