Like Kind And Quality

What Does Like Kind And Quality Mean?

“Like kind and quality” refers to a condition in property insurance policies that stipulates the insurer will cover the cost of repairing or replacing a covered loss with property that is similar to the original in terms of composition and quality.

Insuranceopedia Explains Like Kind And Quality

Many property insurance policies include a “like kind and quality” clause, which benefits the policyholder by ensuring that a covered loss will restore the damaged property to a state equivalent to or very similar to its condition before the loss occurred. How strictly a company applies that standard can vary, which is one reason it’s worth comparing the language used by the best homeowners insurance companies before buying a policy.

For example, if a car insurance policyholder buys a new car and gets into an accident, the insurer would cover the loss by paying for repairs. In this case, the insurer is legally obligated to use parts and materials from the original manufacturer, or, when that is not possible, comparable materials that match the original in kind and quality. The like kind and quality standard usually comes into play under comprehensive or collision coverage, since those are the parts of a policy that pay for repairs to your own vehicle.