Insurance Law Hawaii

Actual Cost Value Includes Depreciation of Repair Labor Costs

    The court granted the insurer's motion to dismiss after determining that benefits paid for actual cost value (ACV) did not include repair or replacement labor costs. Shahan v. Allstate Vehicle & Prop. Ins. Co., 2022 U.S. Dist. LEXIS 135488 (W.D. La. July 29, 2022).

    Hurricane Laura damaged the insured's home. She filed a claim with Allstate under her homeowners policy. Allstate issued payment. The insured filed suit alleging Allstate wrongfully withheld amounts by depreciating labor when calculating the ACV of the damaged property. Allstate moved to dismiss.

    The policy was a replacement cost policy where the insured would receive the actual cash value of her insured property when it was damaged or destroyed by a covered peril. ACV was calculated by taking the repair/replacment which included both material and labor, and then deducting for depreciation. If no repairs or replacements were made, the insured was paid the ACV. If repairs or replacement was done, Allstate reimbursed the insured for the depreciation deduction. The insured challenged Allstate's refusal to pay 100% of the future labor costs, without any depreciation, even if the insured did not replace or repair the damaged property. 

    Some courts agreed with the insured's interpretation that ACV was indemnity coverage intended to return the policyholder back to the status quo, which would never be accomplished if repair labor was withheld. This court did not agree with the insured, however. 

    There was no ambiguity in the policy. The insured attempted to create an ambiguity where none existed. The policy here could not be interpreted to pay the insured for all future labor costs, which have not yet, nor may they ever be, incurred. Depreciation was the actual value of the damaged property reduced by a time factor depending upon the life expectancy of the property. ACV was the replacement of that property, less the depreciation. 

 

Illinois Supreme Court Rules Labor Costs Not Depreciated to Determine Actual Cash Value

    The Illinois Supreme Court determined that a homeowner insurer may not depreciate labor costs in calculating actual cash value (ACV) after a loss under the policy. Sproull v. State Farm Fire and Casualty Co., 2021 Ill. LEXIS 619 (Ill. Sept. 23, 2021). 

    Plaintiff was insured under a homeowner's policy that provided replacement cost coverage for structural damage. Under the policy, the insured would initially receive an ACV payment but then could receive replacement cost value (RCV) if repairs or replacement were completed within two years and the insurer was timely notified. The policy did not define "actual cash value."

    Plaintiff suffered wind damage to his residence and timely submitted a property damage claim to State Farm. The adjuster determined that the building sustained a loss with RCV of $1711.54. In calculating ACV, State Farm began with the RCV and then subtracted plaintiff's $1000 deductible and an additional $394.36, including taxes, for depreciation. Plaintiff thus received an ACV payment of $317.18. Plaintiff claimed that he was underpaid on his ACV claim because State Farm depreciated labor, which is intangible and thus not subject to wear, tear, and obsolescence. Further, labor should not have been depreciated because it was not susceptible to aging or wearing and its value did not diminish over time.

    Plaintiff alleged that State Farm concealed its practice of depreciating labor from its policyholders in several different ways. First, State Farm did not state in its written estimates that Xactimate software was set to depreciate nontangible items such as labor. Second, State Farm did not separate labor and materials in the estimates provided to policyholders. Third, for obvious labor-only charges such as debris removal or roof tear-off charges, State Farm did not depreciate labor. Plaintiff alleged that State Farm did this to help avoid detection of labor depreciation in other line items. In all, the more the ACV payment was lowered, the less likely it was that the policyholder could make up the difference between ACV and RCV and seek reimbursement later.

    Plaintiff sued and State Farm moved to dismiss. The trial court denied the motion, finding the policy was ambiguous because it did not define the term "actual cash value." The appellate court affirmed.

    On appeal, the Supreme Court noted that courts that adopt the view that labor can be depreciated generally (1) find the term "actual cash value" unambiguous, (2) find that materials and labor form an integrated product and that it is not logical to separate labor and materials when applying depreciation, and (3) believe that failing to depreciate labor overcompensates the insured. 

    The court determined that the policy was ambiguous on the question of labor depreciation and construed it in favor of the insured's reasonable interpretation. Labor was not logically depreciable, as it did not lose value over time due to wear and tear. Materials deteriorated with time, but labor did not. Labor was a fixed cost that was not subject to wear and tear, deterioration, or obsolescence. 

Eighth Circuit Affirms Finding of Bad Faith, Award of Costs and Prejudgment Interest

    The Eighth Circuit affirmed the district court's finding of bad faith and award to the insured of taxable costs and prejudgment interest. Selective Ins. Co. v. Sela, 2021 U.S. App. LEXIS 26062 (8th Cir. Aug. 30, 2021). 

    The insured suffered two hail storms that damaged his home. In 2010, the first storm caused over half a million dollars in loss. Before submitting a claim to his original insurer or beginning any repairs, the insured secured a new policy with Selective. The policy did not exclude pre-existing damage, it did preclude coverage if the insured "willfully and with intent to defraud, concealed or misrepresented any material fact or circumstance relating to the insurance."

    Before issuing the policy, Selective appraised the property and assigned a $1.6 million value to the home. The insured then filed a claim with his original insurer and received $510,787.23 for actual cash value of his loss. Neither the terms of this settlement nor this new policy with Selective required the insured to repair all of the 2010 damage. 

    A second storm hit in 2015, damaging the insured's roof. Selective sent an adjuster, who found the damage was "significant." Selective then received an anonymous letter claiming the insured was a serial fraudster who was falsifying claims, Selective brought in its special investigation unit to look into potential fraud. Selective was concerned that the insured said he had repaired all of the 2010 damage while only providing documentation for about $200,000 of work. Selective eventually denied the claim based on fraud.

    Selective then filed suit for a declaration of no coverage. The insured filed a counterclaim for breach of the policy and bad faith. The court determined that the jury would decide coverage, an appraisal panel would determine damages, and the court would decide bad faith. The jury found no fraud, the damage issue went to appraisal, and a date for the bench trial was set.

    A week before the appraisal was finished, Selective moved for summary judgment, arguing the Minnesota statute would bar the bad faith claim because the claim would be resolved by appraisal. The district court denied the motion, held a bench trial and found that Selective denied the claim in bad faith. It awarded judgment for $1,024,233.10, which included the actual case value award, taxable costs, and prejudgment interest. Selective appealed.

    The Eighth Circuit noted that the Minnesota statute allowed an insured to recover taxable costs if an insurer lacked a reasonable basis for denying benefits and did so knowing of or in reckless disregard of the lack of a reasonable basis. The Eighth Circuit agreed with the district court that there was no reasonable basis to deny the insured benefits. Selective recklessly disregarded the lack of a reasonable basis to deny the claim. Prejudgment interest was also properly granted by the district court. Under Minnesota precedent, the district court found that Selective had enoguht information in the property loss notice to assess its potential liability. Prejudgment interest was due from this point forward.

South Caroline Holds Actual Cash Value Can Include Depreciation of Labor Costs

    Answering a certified question, the South Carolina Supreme Court held that the insurer could calculate actual cash value (ACV) by including an estimate of the depreciation of embedded labor costs. Butler v. Travelers Home & Marine Ins. Co., 2021 S. C. LEXIS 51 (S.C. May 12, 2021). 

    Two insureds had their homes damaged in separate fires. Each held homeowners' policies with Travelers. The policies provided replacement cost value coverage to repair or replace damaged portions of homes. In the event that the insures chose not to immediately repair or replace the damaged home, the policies afforded payment to the insured for the actual cash value instead of replacement cost value. Both insured elected not to immediately repair or replace their homes, thereby deciding to accept a cash payment for the ACV of the damaged property. Neither was satisfied with the payment and both filed suit in federal district court.

    Travelers determined the ACV payment by estimating the replacement cost value (RCV) of the damage and then subtracting depreciation. The certified question presented by the federal district court was whether Travelers could depreciate the labor component of the costs of repair or replacement when determining the ACV. 

    The court noted that to calculate RCV, a determination was made on the extent of the damage and then soliciting bids to have the damage repaired or replaced. ACV, on the other hand, was difficult to determine in a specific situation. There was normally no market for aged and partially deteriorated portions of homes. 

    Here, Travelers began by estimating the RCV of the damaged property, and from that number it subtracted a separate estimate of lost value, or depreciation. It was unclear how Travelers went about determining the appropriate amount for depreciation. but it did include labor costs in the depreciation calculation. 

    The court found that labor costs were "embedded" with the property. To illustrate, the cost of a new roof included the cost of shingles and nails. Initially, the shingles and nails had labor costs because workers had to make them. By the time the shingles and nails were sold to the roofer, however, those labor costs were "embedded" in the market price the roofer paid to purchase them. Thus, the roofer paid one price for the shingles and one price for the nails. There was no differentiation between the cost of materials in those products and the cost of labor used to make them. Similarly, the cost of a new roof included paying workers to remove the old roof and install the new one. The market had one price for the roof because the material and labor costs were "embedded" in it. 

    Here, the value of the damaged property was reasonably calculated as a unit. Therefore, the court answered the certified question "yes." It made no sense for an insurer to include depreciation for materials and not for embedded labor. 

    The court noted, however, that if the insured believed its insurer made an incorrect calculation on ACV, a question of fact was presented for a fact finder to determine. 

    

Insured Proves Collapse, but Fails to Establish Any Value for Loss

    While the insured was able to carry his burden to show the collapse of a roof, he failed to establish damages under the policy. Iannucci v. Allstate Ins. Co., 2018 U.S. Dist. LEXIS 203687 (N.D. N.Y. Dec. 3, 2018). 

    In 2005, the insured purchased a parcel of land together with a three-story building constructed in 1870. No one resided in the building at the time of purchase or afterward. The building was not well maintained and all utilities were shut off. No work was done on the building between 2005 and 2014. Between 2011 and 2014, the Fire Department issued multiple zoning/ordinance violation notices ordering the insured to make various improvements to the building and property. A notice issued in October 2013 stated that "the roof on your house needs to be replaced." Before any work was done on the roof, however, it collapsed during a snowstorm on February 21, 2014. 

    The insured's all-risk policy excluded loss caused by such things as enforcement of building codes, failure to preserve property, wear and tear, aging, and faulty, inadequate or defective maintenance. The policy covered collapse, however, for "(a) the entire collapse of a covered building structure; (b) the entire collapse of part of a covered building structure; and (c) direct physical loss to covered property caused by (a) or (b)." The collapse had to be "sudden and accidental" and caused by, among other things, weight of snow which collected on a roof.

    On March 5, 2013, the fire department issued a violation notice directing the insured to demolish the building because the roof had collapsed. The City's file indicated that the roof's collapse had been caused by the accumulation of snow. The insured notified Allstate. A claims adjuster visited the property and photographed extensive damage to the building. Allstate denied the claim based upon an expert's report that the cause of the roof collapse was the lack of adequate and timely maintenance. Allstate cited several additional exclusions, including enforcement of building codes, failure to preserve property, wear and tear, and inadequate maintenance in denying the claim. 

    The insured sued and a bench trial was conducted. The court found that the collapse of the roof was sudden, but the "entire collapse" of the building was not. The insured therefore failed to prove that the loss of the building structure was within coverage under the policy, even if the collapse of the roof was covered. 

    The policy stated it did "not cover loss to covered property . . . when :(a) there are two or more causes of loss to the covered property; and (b) the predominant cause(s) of loss is (are) excluded" from coverage. Here, the evidence did not show that any cause was predominant to the weight of snow in directly bringing about the collapse of the roof. Instead, the preponderance of the evidence indicated that the most direct and obvious cause of the collapse of the roof was the weight of the snow. Allstate failed to prove that any of the other causes, such as inadequate maintenance - considered separately or together - predominated over the weight of the snow as the efficient cause of the collapse. 

    Therefore, the insured carried his burden to prove coverage for collapse of the roof. Nevertheless, the insured failed to establish the value of his loss under the policy. The insured failed to provide any evidence regarding the value of the roof or from which to infer its value, e.g., the market value of the building before and after the collapse or the cost of replacing the roof with one of like kind or quality. Allstate, on the other hand, established that the roof was worthless. Accordingly, the insured was not entitled to damages for the loss of the roof. 

Labor Costs Not Excluded From Depreciation When Determining Actual Cash Value

    The court dismissed a class action suit against State Farm which sought to establish that a calculation of actual cash value (ACV) in a homeowners policy could not depreciate the cost of labor. Cranfield v. State Farm Fire & Cas. Co., 2018 U.S. Dist. LEXIS 199618 (N.D. Ohio Nov. 26, 2018)

    Cranfield submitted a claim to State Farm after his home was damaged by a storm. An adjuster inspected the damage and an estimate for repair was sent to Cranfield. The total cost to repair the damage, the replacement cost value, was $4,044.86. State Farm calculated the depreciation amount to be $1,348.57. With the deductible, State Farm sent a net ACV of $842.29 to Cranfield. 

    The policy had a two-step loss settlement provision under which State Farm paid the ACV at the time of loss. Only the ACV was paid until the actual repair was made. Once the repair was completed, State Farm would pay the additional amount that the policy holder actually spent. Cranfield filed a class action suit, challenging the manner which State Farm calculated ACV. He argued that including labor along with materials in the depreciation calculation resulted in an ACV payment that was less than he was contractually entitled. 

    The court disagreed. As used in the policy, ACV was not ambiguous. Black's defined "ACV" as "replacement costs minus normal depreciation" or fair market value. There was nothing in the policy to indicate that the intent of the parties was to limit the definition of ACV to exclude labor from depreciation. The policy did not separately insure the labor and building materials, but the sum total of these parts. Accordingly, the term ACV was unambiguous and State Farm's inclusion of labor in depreciation did not breach the policy. 

Data Breach Does Not Constitute "Personal Injury" Under CGL Policy

    The federal district court agreed with the insurer that there was no coverage for the insured's causing a data breach. St. Paul Fire & Marine Ins. Co. v. Rosen Millennium, Inc., 2018 U.S. Dist. LEXIS 173072 (M. D. Fla. Sept. 28, 2018).

    Millennium provided data security services for Rosen Hotels & Resorts, Inc. (RHR). In February 2016, RHR became aware of a potential credit card breach at on of their hotels. RHR hired a forensic investigator to determine whether a data breach occurred. The forensic investigator found malware installed on the payment network and determined that customers' cards may have been affected. RHR disclosed the data breach to potentially affected customers.

    Millennium submitted a Notice of Claim to St. Paul after receiving an email from RHR indicating that RHR believed that the data breach was caused by Millennium's negligence and inquiring as to whether Millennium had insurance to cover such a loss. St. Paul issued a reservation of rights, indicating there was no coverage for the claim. Millennium then provided a letter from RHR in which RHR alleged it was entitled to payment from Millennium as a result of the data breach. RHR did never filed suit.

    St. Paul filed suit for a declaratory judgment that it had no defense obligations and moved for summary judgment. RHR argued St. Paul was obligated to defend because: (1) the customers' loss of use of their credit cards, and the inevitable replacement of the cards, was covered as "property damage;" and (2) the costs incurred by RHR in complying with the notification statutes were covered under the policy. 

    The court noted there was no underlying complaint, so it looked at RHR's Notice of Claim and demand letter. The Notice of Claim had no substantive information other than the fact that a 'credit card systems breach occurred. Details in the demand letter were also sparse, but it specifically stated that Millennium "made private information known to third parties that violated a credit care holder's right of privacy." Therefore, the court addressed St. Paul's duty to defend under the personal injury provisions of the policy.

    The policy defined "personal injury" as an "injury other than bodily injury or advertising injury, that's caused by a personal injury offense." A "personal injury offense" included "making known to any person or organization covered material that violates a person's right of privacy." The parties disputed whether the "making known" requirement was met. The parties agreed that "making known" was synonymous with "publication." 

    The court determined there was no publication. The CGL policy required covered personal injuries to result from the insured's business activities. RHR's alleged injuries did not result from Millennium's business activities but rather the actions of third parties. Therefore, RHR's personal injury claim was not covered under the policy and St. Paul had no duty to defend. 

Broad Evidence Rule Used To Determine Actual Cash Value

    Affirming the District Court, the Seventh Circuit agreed that the broad evidence rule was used under Indiana law to determine actual cash value. Thorne v. Member Select Ins. Co., 2018 U.S. App. LEXIS 3265 (7th Cir. Feb. 12, 2018).

    Thorne's home burned to the ground in February 2008. Member Select refused to cover the loss because it determined that Thorne intentionally set the fire. After the jury's verdict in Thorn's favor, Member Select moved for judgment as a matter of law. Member Select argued that there was insufficient evidence for the jury to determine damages. The District Court entered a post-trial decision in Thorne's favor. Member Select appealed. Member Select also argued on appeal that the District Court misinterpreted the policy's loss coverage provision in evaluating whether the evidence was sufficient to support the jury's damages award.

    The policy promised to pay "actual cash value" at the time of loss, but never defined the term "actual cash value." Courts around the country used four methods to define the term when it was not expressly defined in the policy. The methods were: (1) replacement cost, without deduction for depreciation; (2) market value; (3) replacement cost with deduction for depreciation; and (4) the broad evidence rule. The last three all took depreciation (or decrease in value due to use and age) into account. 

    The District Court used the broad evidence rule, which meant the parties could introduce evidence of every fact and circumstance which would logically tend to the formation of a correct estimate of the loss. Member Select argued, however, that the policy implicitly defined "actual cash value" as "replacement cost less depreciation," which was a narrower formula than the broad evidence rule. But the policy never mentioned "replacement cost' in conjunction with "actual cash value." Because the policy failed to expressly define "actual cash value" to mean "replacement cost less depreciation," the district court correctly looked to Indiana's broad evidence rule in interpreting the policy, despite the policy's requirement that "actual cash value" include depreciation. If Member Select wanted to define "actual cash value" as replacement cost less depreciation," it easily could have done so. The term "depreciation" was therefore ambiguous and construed against Member Select. The District Court correctly used the broad evidence rule to interpret the policy.

    Member Select further contended that even if the broad evidence rule was the proper standard, there was insufficient evidence for the jury to determine damages. The jury was informed that Thorne's brother bought the house for $86,000 in 1998; Thorne bought the house for $75,000 in 2002. In 2004, Thorne had paid down the mortgage to $67,000 and opened a line of credit for $20,000 secured by the house. Thorne also testified about the general condition of the house and its contents before and after the fire. Therefore, Thorne argued that the jury's award of $87,000 was reasonable based on adding the $20,000 line of credit to the $67,000 remaining on the mortgage in 2004, plus an estimate of the value of his lost personal possessions. 

    Member Select argued that the jury could not reach a reasonable verdict without "opinion" evidence regarding the house's value at the time of the fire - whether from Thorne or another witness. But the Indian Supreme Court had held that under the broad evidence rule, any fact reasonably tending to throw light upon the subject was relevant, including original cost. 

    The evidence presented to the jury was reasonably precise evidence of what Thorne's house and its contents were worth, even if it was somewhat outdated. To the extent Member Select contested the evidence presented, it could have put forth its own evidence, but chose not to do so. 

    Therefore, the denial of Member Select's motion for judgment as a matter of law was affirmed. 

    

Bad Faith Damages Awarded for Claims Handling

    The insureds prevailed at trial in securing an award for bad faith due to the insurer's unreasonable handling of the claim. Taladay v. Metro. Group Prop. & Cas. Ins. Co., 2016 U.S. Dist. LEXIS 87659 (W.D. Wash. July 6, 2016).

    Rosemarie Taladay had a homeowners policy with MetLife. After her death, one of her three sons, Gary Taladay, was living with her in the home when a fire occurred in an upstairs attic room. An investigation determined that most of the fire damage was in the attic bedroom, but water damage from the fire department's efforts to extinguish the fire was present on the first floor as well. The MetLife policy generally excluded water damage, but direct loss ensuing after water damage "caused by fire" was a covered cause of loss. 

    Gary Taladay had difficult discovering the identity of the insurer, MetLife. He signed two contracts for emergency services with Heritage Restoration after informing the company that he did not know the identity of the insurer and could not afford to pay for the mitigation work on his own. Heritage removed salvageable items form the house and attempted to assist in locating Ms. Taladay's fire insurance policy. Gary Taladay reported the fire to the mortgage company, Chase, but Chase refused to identify the insurance company. 

    Gary Taladay could not live in the house due to the fire damage and began living in an inexpensive motel. He was unable to afford both the motel bill and mortgage, so the mortgage was placed in default by Chase. 

    The policy was eventually located and MetLife was notified. MetLife investigated, but delayed making any payments until suit was filed. MetLife contended that it did not unreasonably deny coverage because the insureds failed to mitigate the loss to the first floor, failed to timely submit receipts for the additional living expenses, and failed to timely submit a properly completed Proof of Loss form with an inventory of unsalvageable personal property to enable Met Life to adjust the claim.

    MetLife repeatedly misrepresented to the insureds that the adjustments of their entire claim, including structure damage and alternative living expenses, were contingent upon presentation of a complete inventory of damaged personal property. But at trial, numerous witnesses from MetLife testified that MetLife was able to adjust the structure portion of the claims and the alternative living expenses without the inventory of damaged personal property. MetLife compelled the insureds to file suit to recover for repair estimates was also contrary to Washington law. 

    MetLife also unreasonably modified the insureds' contractor's estimates of repair related to gutting the first floor of the house. This greatly reduced funds available for the insureds to make necessary repairs and made it impossible for the insureds to find a contractor willing to complete the work. Because the insureds could not make the repairs, Chase foreclosed on the house. MetLife not only wrongfully denied coverage for the repairs, but never communicated the denial to the insureds.

    After suit was filed, MetLife paid a portion of the claim. The remaining issue, therefore, was whether MetLife's substantial delay in making the payment was reasonable. The MetLife adjuster created an inventory the second day he visited the property, listing approximately 140 items in the attic that were damaged by the fire. He withheld his inventory list from the insureds because they had not yet generated their own complete inventory of damaged items. The adjuster said he was waiting for a signed Proof of Loss form to be submitted by the insureds. A partially completed Proof of Loss form was submitted on September 3, 2014 by Gary's brother, Denny Taladay. In the section requesting estimates of "Actual Cash Value" of the property, Denny wrote "unknown." MetLife therefore refused to adjust the claim and refused to issue any payments until a completed inventory was received. 

    Only after suit was filed did MetLife finally pay $91,771 for additional loss under the claim.The court found this unreasonable. The adjuster had concealed his inventory of personal property items from the insureds even after the insures informed him that they needed a professional to assist with the inventory. MetLife failed to provide the insureds with reasonable assistance, contrary to Washington law. Consequently, MetLife breached the duty of good faith. The court awarded $254,770, plus attorneys' fees for actual and punitive damages.

Depreciating Labor Costs May be Factor in Actual Cash Value

   The Minnesota Supreme Court considered a certified question from the the U.S. District Court regarding consideration of depreciating labor costs in determining the actual cash value of a loss. Wilcox v. State Farm Fire & Cas. Co., 2016 Min. LEXIS 50 (Minn. Feb. 10, 2016).

   The insureds' home was damaged by hail. State Farm provided a written estimate that calculated the actual cash value of the loss. To estimate the actual cash value of the damaged property, State Farm first calculated the replacement costs of individual items, such as roof flashing, siding, fascia, gutters, and window screens. Next, State Farm subtracted the pre-loss depreciation of some, but not all, individual items. For example, State Farm depreciated the cost of removing and replacing certain materials, such as siding. State Farm did not depreciate the cost of the new siding separately from the cost of the labor required to install the new siding on the home. Instead, State Farm calculated the removal and replacement of the siding as a single cost, then depreciated the removal-and-replacement cost as a whole. The cost of labor to repair or replace the damaged property was referred to by the court as "embedded labor costs."

   Suit was filed, alleging that State Farm's practice of depreciating embedded labor costs breached the duty to indemnify the insured for the actual cash value of the damaged property. The policy provided that State Farm would pay "only the actual cash value at the time of the loss of the damaged party of the property" until the property was repaired or replaced. Then State Farm would pay the full repair or replacement costs. "Actual Cash Value" was not defined by the policy, nor were the methods described for calculating actual cash value.

   State Farm moved to dismiss the complaint. The magistrate judge concluded that labor depreciation was not permitted when the policy did not define "actual cash value" and recommended that the district court deny State Farm's motion to dismiss. The district court certified the question regarding depreciation of embedded labor costs to the Minnesota Supreme Court.

   Minnesota adopts the broad evidence rule in calculating the actual cash value of a loss. The breadth of discretion provided to the trier of fact under the broad evidence rule was the best method to assure complete indemnity to the insured. The rule provided a flexible approach that considered several relevant facts such as the original cost of the property, the market value of the property at the time of loss, the cost of reconstruction, the cost of removing debris, the amount of salvage, and the potential remaining uses of the property. The jury could also consider opinions on value given by expert witnesses. 

   The broad evidence rule did not dictate whether labor was depreciable or not depreciable. Rather, embedded-labor-cost depreciation was one factor that the trier of fact could consider amoung other factors to determine the actual cash value of the damaged property. 

   Therefore, the court answered the certified question as follows:

    When a homeowner's policy does not define the term "actual cash value" or otherwise state whether embedded labor costs are depreciable for the purpose of calculating actual cash value, the trier of fact may consider embedded-labor-cost depreciation when such evidence logically tends to establish the actual cash value of a covered loss. Embedded-labor-cost depreciation, however, is only one of many factors to be considered by the trier of fact; and its relevance depends on the facts and circumstances of the particular case.