Final answer:
Tenants' improvements and betterments not replaced after a loss are typically valued at Actual Cash Value (ACV), which considers depreciation. Option B is correct.
Step-by-step explanation:
Under the building and personal property coverage form, if tenants' improvements and betterments are not replaced after a loss, they are typically valued based on Actual Cash Value (ACV).
This value is calculated by taking into account the depreciation of the improvements and betterments since the time they were placed. The replacement cost and original cost do not come into play unless it is explicitly stated in the policy that they should be used instead of ACV.
For example, if a tenant installs new lighting fixtures and cabinetry, and these are damaged in a covered event, the amount the insurance company will pay if the tenant does not replace these items will be the depreciated value of the fixtures and cabinetry at the time of the loss.