What does it mean when my insurance coverage is based on Actual Cash Value?

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Actual Cash Value (ACV) is an insurance term that will impact how much you are paid in the event of a loss due to stolen or damaged property.

When a policy’s coverage is based on ACV, the amount of money you will recover for a covered loss is the calculated on the replacement cost MINUS an amount for depreciation of the property.

The ACV amount is almost always less than the Replacement Value amount and the depreciation deduction can result in a significant reduction in the amount of money you are paid for your claim.

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