If you’ve filed a claim before, you’ve probably seen these two terms on your estimate and wondered what the difference actually costs you. Here’s the short version.
ACV (Actual Cash Value) is what your damaged item or material is worth today — the replacement cost minus depreciation for age and wear. If your 15-year-old roof is damaged, ACV pays out what a 15-year-old roof is worth, not what a brand-new one costs.
RCV (Replacement Cost Value) is what it actually costs to replace that same item new, with no deduction for age or wear.
Here’s where it gets confusing: most policies pay out in two parts. You get the ACV amount first. Then, once the repair or replacement is actually completed, your insurance company releases the difference between ACV and RCV — often called recoverable depreciation. If you don’t complete the repairs, you typically don’t see that second check.
Why this matters to you:
- Your first check is not the full amount you’re entitled to — it’s a deposit.
- You have to actually do the work to collect the rest.
- There’s usually a time limit (check your policy) to complete repairs and request that second payment.
Where we come in: because we have a former insurance agent and licensed adjusters on our team, we know how to read your policy and make sure your estimate is built to capture the full RCV you’re owed — not just the first check. We’ll also flag the recoverable depreciation deadline so it doesn’t slip past you.