Actual Cash Value

Actual Cash Value is a valuation method used by insurers to determine the payout for a loss. It is calculated by taking the current replacement cost of an item and subtracting depreciation based on its age and condition. In the market, many carriers are shifting older roofs to ACV to manage rising repair costs. For homeowners, this means a lower payout for aged items, as the policy only covers what the item was worth at the exact moment it was damaged or stolen.