Replacement Cost

{
  "id": "MLC-T-ENV-023873",
  "term": "Replacement Cost",
  "field": "Environment",
  "definition": "1. The cost of replacing property without deduction for depreciation.\n\n2. Costs necessarily incurred by the insured to repair or replace real or personal property damaged during the course of remediation expense in order to restore the property to the condition it was in prior to remediation expense. Within the insurance field, it is often required that these costs shall not exceed the net present value of such property prior to the investigation, removal, disposal, treatment, or neutralization of pollution conditions.\n\n3. How much will it cost to replace the asset, if required today?\n\n4. Capital needed to purchase all the depreciable components in a facility. [40 CFR 60.481 (CFR 2013)] [40 CFR 60.481a (CFR 2013)]",
  "subject": "Land, waste and cleanup",
  "references": [
    "Environmental Insurance and Risk Management Tools Glossary",
    "Check Up Program for Small Systems (CUPSS) Glossary",
    "40 CFR 60.481b (CFR 2024)"
  ],
  "url": "https://mlchart.com/terminology/environment/replacement-cost/"
}