How do insurance companies calculate cost of replacement, specifically for a bike?
I had my bike stolen from my apartment. My renter’s insurance covers “cost of replacement” for my bike. However, my bike was 8 years old and the model is no longer made. Bike costs in general have gone way up. I payed $270 for a mid-range new hybrid bike in 2006, but I couldn’t actually get a new bike for that much now and I don’t feel comfortable getting a used one. How do insurance companies determine the “cost of replacement”? I think I would need more like $400 to get an analogous new bike now, but do they account for that, or would they just pay the original cost of the bike (maybe plus inflation)? If anyone has any knowledge about this or experience with calculations like that, I’d greatly appreciate any insight. I use my bike to commute and need to estimate how much I’ll have to spend on a new bike before I can wait for their assessment.
Thanks!
My insurance company ended up just accepting my suggestion that it was comparable to the new model by the same brand. I bought that model and sent them the receipt, and they’re sending me a reimbursement. The version of the bike that was available ended up being more like $400, and they paid the full price (minus my deductible). The price of a new bike has increased more than inflation, and it seems at least by this company’s definition, replacement cost factors that in.