Replacement cost coverage is triggered when you actually replace the item. The company will initially pay the depreciated value (ACV) and will pay the difference between depreciated value and the replacement cost upon evidence that the items have been replaced. This applies to the structure and contents. Some companies will release replacement cost payment for the dwelling when you produce a signed repair contract from a licensed contractor. In the case of a dwelling’s total loss, the structure portion of the claim is usually paid in full. The legislature changed this in 2005 and hold back no longer applies.