Ask Bob Insurance What is the difference between actual cash value and replacement cost?
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What is the difference between actual cash value and replacement cost?

Actual cash value (ACV) pays what your property is worth today after depreciation. Replacement cost value (RCV) pays what it costs to replace it brand new at today's prices. For example, a 10-year-old roof might have an ACV of a few thousand dollars but an RCV of $15,000. Most standard policies offer RCV for your home's structure and ACV for older personal belongings. Upgrading to RCV on contents costs more but provides significantly better protection when you need to replace everything after a covered loss.

Why It Matters

Choosing between ACV and RCV dramatically affects your claim payout. RCV could mean tens of thousands more after a major loss.

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