What is the difference between “actual cash value” (ACV) and “replacement cost”?
When a loss is paid using ACV, the policyholder is entitled to the depreciated value (the cost to repair/replace the property less depreciation) of the damaged property. When a loss is paid using replacement cost, the policyholder is entitled to the amount necessary to repair/replace the damaged property with one of “like kind or quality” at current prices. We recommend you always carry replacement cost coverage for your dwelling and/or personal property.
