Olson v. Le Mars Mutual Insurance Company of Iowa

Summary

The Supreme Court of Nebraska considered whether an insurer could deduct depreciation from the cost of repairing partial hail damage under an actual cash value property insurance policy. The court held that, absent express policy language permitting the deduction, depreciation could not be deducted where repairing the property would not increase its actual cash value beyond its pre-loss value. The court reduced the judgment to the repair cost less the policy deductible and affirmed as modified.

Holdings

1. Under an actual cash value policy that does not expressly provide otherwise, an insurer may not deduct depreciation from the cost of repairing partial damage to insured property when the actual cash value of the property as repaired would not exceed its actual cash value immediately before the loss.
2. Olson's recovery was limited to the undisputed repair cost of $95,040 less the $500 deductible, for a total judgment of $94,540.

Questions Presented

1. Whether an actual cash value property insurance policy permitted the insurer to deduct depreciation from the cost of repairing partial damage when the policy did not expressly authorize that deduction.
2. Whether the evidence established the amount of the insured's recoverable loss.
3. Whether the district court properly resolved the parties' cross-motions for summary judgment.

Disposition

affirmed