What do the terms etterment and depreciation refer to?
‘Betterment’ is used to identify parts, in the case of some suspension components, tires and batteries, that show measurable wear or have a finite life span. The insurance company can by law, recover that portion of the replacement cost which had been used at the time of the accident. For instance, a tire which showed 50% remaining tread depth or a battery with a four year warranty and was two years from date of purchase would require that the customer pay for 50% of the replacement cost of the part itself plus tax. Depreciation is seldom seen these days but could be applied to a vandalized paint finish or cut convertible top, for instance. The insurance company is responsible for making the majority of these determinations but most insurance policies spell out the details.
