Senate Bill 2492

AN ACT TO PROVIDE THAT CERTAIN DEPRECIATIONS MAY BE APPLIED IN AN INSURANCE POLICY COVERING DAMAGE TO PROPERTY; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. (1) As used in this section, "Depreciation" means the loss of value of property or service over time due to factors such as age, utility, demand, obsolescence, and wear and tear and includes, but is not limited to, the cost of all goods, materials, labor, services, fees, permits and taxes necessary to replace, repair or rebuild damaged property.

(2) Depreciation may be applied in claims for damage to property under an insurance policy.

(3) If depreciation of labor is applied to a loss for damage to property, the language of the policy must clearly provide for the depreciation of labor in adjustment of a property loss claim. However, insurance policies covering physical damage to automobiles, recreational vehicles, motor homes, motorcycles, boats, and any other form of motor vehicles or watercraft, and personal property may provide for a market value or actual cash value evaluation or appraisal without reference to depreciation.

(4) Unless otherwise excluded or exempted in subection (3) of this section, if depreciation is applied to a loss for damage to property, the insurer shall provide a written explanation or calculation to the insured reflecting how depreciation was applied.

SECTION 2. This act shall take effect and be in force from and after July 1, 2018.