What is the difference between “actual cash value” and “replacement cost”?
Covered losses under a homeowners policy can be paid on either an actual cash value basis or on a replacement cost basis. When “actual cash value” is used, the policy owner is entitled to the depreciated value of the damaged property. Under the “replacement cost” coverage, the policy owner is reimbursed an amount necessary to replace the article with one of similar type and quality at current prices.
Covered losses under a homeowner policy can be paid on either an actual cash value basis or on a replacement cost basis. When “actual cash value” is used, the policy owner is entitled to the depreciated value of the damaged property. Under the “replacement cost” coverage, the policy owner is reimbursed an amount necessary to replace the article with one of similar type and quality at current prices.
Covered losses under a homeowner’s policy can be paid on either an actual cash value basis or on a replacement cost basis. When “actual cash value” is used, the policy owner is entitled to the depreciated value of the damaged property – so the older the item is, the less money you may receive for it. Under the “replacement cost” coverage, the policy owner is reimbursed the amount it costs to replace the property with something of a similar type and quality at current prices.
Covered losses under a homeowners policy can be paid on either an actual cash value basis or on a replacement cost basis. When “actual cash value” is used, the policy owner is entitled to the depreciated value of the damaged property – so the older the item is, the less money you may receive for it. Under the “replacement cost” coverage, the policy owner is reimbursed the amount it costs to replace the property with something of a similar type and quality at current prices.
Covered losses under a homeowner’s policy can be paid on either an actual cash value basis or on a replacement cost basis. When “actual cash value” is used, the policy will reimburse the homeowner to the depreciated value of the damaged property. Under the “replacement cost” coverage, the homeowner is reimbursed an amount necessary to replace the article with one of similar type and quality at current prices. It is important that you understand up front which type of replacement coverage your policy offers. If you purchase an actual cast value policy, you may not receive nearly enough reimbursement to replace your belongings.
