GENERAL KNOWLEDGE

Detailed explanation-1: -Generally, the replacement cost minus the depreciation in the value of the asset gives the actual cash value in insurance.

Detailed explanation-2: -Actual cash value (ACV) is the amount to replace your damaged or stolen property, minus depreciation, at the time of the loss. It doesn’t replace what you lost-instead, it reimburses you for the item’s current value.

Detailed explanation-3: -Actual cash value means the value of the damaged part of the property at the time of loss, calculated as the estimated cost to repair or replace such property, less a deduction to account for pre-loss depreciation.

Detailed explanation-4: -If you have Replacement Cost Value (RCV) coverage, your policy will pay the cost to repair or replace your damaged property without deducting for depreciation. If you have Actual Cash Value (ACV) coverage, your policy will pay the depreciated cost to repair or replace your damaged property.