Compare / Actual Cash Value vs Replacement Cost
Actual Cash Value vs Replacement Cost
The settlement basis you pick today decides how much money you get when something is destroyed.
| Feature | Actual Cash Value | Replacement Cost |
|---|---|---|
| Subtracts depreciation | Yes | No |
| Premium impact | Lower | Higher |
| Out-of-pocket after big loss | Higher | Lower |
| Common on | Older roofs, older cars | Most homeowners contents |
Best for Actual Cash Value
Older property where premium savings outweigh payout gap.
Best for Replacement Cost
Anyone who can't easily replace property out of pocket.