10/21/2021
Say your living room catches fire and you lose your furniture and electronics. Does your insurance policy cover replacement cost or actual cash value (ACV)? Do you know the difference?
ACV policies cover items at current market value, taking depreciation into account. Bargain shopping is great, but you may not want to replace all your belongings with second-hand items. On the other hand, replacement costs provide the entire cost to replace items with the same or very similar models.
What is the difference between replacement cost and actual cash value? We go into detail what the difference is when it comes to your valuables.