FLOOD02918

• County: Denver
• Community: Denver
• Stream Name: South Platte River
• Basin: South Platte
• Title: Estimation of Flood Depth-Damage Curves for Residential, Commercial and Industrial Properties in the Denver Region
• Date: 10/1/1977
• Prepared For: CWCB
• Prepared By: Wayne J. Grahm ‎(Master of Science Candidate at CSU)‎
• Floodplain - Doc Type: Educational/Technical/Reference Information

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While the above would make one think that the FIA curves understate

damages, the use of "replacement cost" rather than "actual cash value"

yields damages that probably result in a structure increasing in value

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rather than the value remaining constant after having the damages repaired.

This applies only to single-family dwelling structures. Here is how this

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provision works: Provided flood insurance coverage is held for 80% or

more of the replacement cost of a structure or the maximum amount of

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insurance available under the National Flood Insurance Program, the in-

surance pays for full replacement cost rather than actual cash value of

the loss which would include depreciation. Thus, for example, if during

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a flood, paneling and painted walls were damaged, the full cost of repair-

ing or repainting-repaneling would be allowed under the replacement cost

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provision even though the paint and paneling may have been totally worn

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before the flood damage occurred, Actual Cash Value insurance would

pay the cost of replacement less the depreciation. Certain structural

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items such as carpeting, and domestic appliances are based on Actual Cash

Value. Contents and any structure other than a single family dwelling

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structure, uses the actual cash value basis rather than replacement cost.

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Another work of caution concerning the use of the FIA depth-damage

curves results from the definition of "total value". Total value for

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contents should really read a~tual cash value (not the same as what some-

one paid for an item) and total value for the structure should read actual

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cash value (not replacement value) of the structure. Thus, a house and

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lot in Denver that sells for $50,000 might break down as follows: replace-

ment cost of house - $44,000, value of lot - $6,000. If the house was

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relatively new, the actual cash value of the structure would be very close

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