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actual cash value
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actual cash value

insurance
Also known as: ACV
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Quick Summary

Actual cash value (ACV) in insurance refers to the amount of money equal to the cost of replacing lost, stolen, or damaged property after accounting for depreciation. This means the payout reflects the property's current value, not its original cost or the cost to replace it with a new item.1

In property insurance, ACV is one basis for determining the amount recoverable. If a policy covers losses on an ACV basis, the payout is the full replacement cost minus an allowance for depreciation. This contrasts with replacement cost coverage, where depreciation is not factored in, and the owner receives the full cost to replace the item with a new one, provided the coverage meets a certain percentage of the property's replacement value.2

Summary created from Britannica articles using AI. AI can make mistakes, so verify using Britannica articles.
2 Britannica Sources
  1. actual cash value
  2. insurance - Limitations on amount recoverable

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