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Replacement cost vs actual cash value: which is better?

By Insuregear · 4 min read · Updated June 18, 2026

Replacement cost pays to replace damaged items with new equivalents. Actual cash value (ACV) subtracts depreciation, so a 10-year-old roof pays out far less.

The bottom line

Replacement cost costs a bit more in premium but pays far more when you file. For your dwelling and belongings, it's usually worth it.

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