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 policyowner is entitled to the depreciated value of the damaged property. Under the “replacement cost” coverage, the policyowner is reimbursed an amount necessary to replace the article with one of similar type and quality at current prices.
You can either insure your belongings for their actual cash value, which pays to replace your home or possessions minus a deduction for depreciation up to the limit of your policy. Or you can opt for replacement cost, which pays the actual cost of replacing your home or possessions up to the limit of your policy.
Covered losses under a home owner’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. 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 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 policyowner 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 policyowner 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 policyowner is entitled to the depreciated value of the damaged property. Under the “replacement cost” coverage, the policyowner is reimbursed an amount necessary to replace the article with one of similar type and quality at current prices.
