Loss of Market Value
Definition:
The decrease in a property’s value after it has been damaged and repaired.
Explanation:
Standard homeowners policies generally exclude coverage for loss of market value, covering only the cost of repair or replacement.
Example:
Even after full repairs, a fire-damaged home may sell for less than similar homes because of its history. That reduction is loss of market value.
Why it matters:
This term affects how claims are handled and what payout a homeowner may receive.