Claim vocabulary
What is ACV on an insurance claim?
ACV stands for Actual Cash Value. It's replacement cost minus depreciation — what your insurance company pays after subtracting for age and wear on the damaged property. On most claims it's the first (smaller) check. Here's what that means in real dollars and how to get the rest of the money you're owed.
The ACV formula in one line
RCV − Depreciation = ACV
Worked example: a 10-year-old asphalt shingle roof on a 20-year useful-life schedule is roughly 50% depreciated. If the replacement quote is $24,000, depreciation is around $12,000, ACV is $12,000. Subtract your deductible (say $2,000) and the first check is $10,000.
ACV vs RCV — the difference that matters
On a Replacement Cost (RCV) homeowners policy, the carrier holds back depreciation but releases it as a second check after you finish the work. On an ACV-only endorsement, the depreciation is gone for good — no second check.
| Loss settlement type | First check | Second check? |
|---|---|---|
| RCV (Replacement Cost) | ACV minus deductible | Yes — recoverable depreciation released after work is complete |
| ACV (Actual Cash Value) | ACV minus deductible | No — depreciation is permanent |
See the full comparison on Replacement Cost vs Actual Cash Value.
How insurers calculate the depreciation
Most carriers use straight-line depreciation against the item's useful life:
| Item | Useful life | 10-yr depreciation |
|---|---|---|
| Asphalt shingle roof | 20 yrs | ~50% |
| Architectural shingle | 25-30 yrs | ~33-40% |
| Gutters / siding | 25 yrs | ~40% |
| HVAC condenser | 15 yrs | ~66% |
| Carpet | 10 yrs | ~100% |
How to get more than ACV
- 1Confirm your policy is RCV — check your declarations page for 'Replacement Cost' loss settlement, and look for a roof-specific endorsement that may downgrade it.
- 2Complete the repairs with a licensed contractor.
- 3Send the carrier a signed invoice, paid receipt, and proof of completion.
- 4Most carriers issue the recoverable depreciation check within 2-4 weeks.
Full playbook: how to recover depreciation on a roof claim.
Frequently asked
What does ACV mean on an insurance claim?
ACV stands for Actual Cash Value. It's what the carrier pays when you file a claim — replacement cost of the damaged property minus depreciation for age and wear. On an RCV policy the held-back depreciation is recoverable; on an ACV policy it's permanent.
How is ACV calculated on a roof?
Insurers depreciate the roof by its age divided by its expected useful life. A 10-year-old asphalt shingle roof on a 20-year scale is roughly 50% depreciated. If replacement cost is $24,000, ACV would be around $12,000 — minus your deductible — for the first check.
Is ACV the same as market value?
No. ACV is replacement cost minus depreciation. Market value is what someone would pay for the property — driven by location, supply, and demand. For insurance claims, ACV is the only number that matters.
How do I get more than ACV on a claim?
If your policy is RCV (Replacement Cost Value), complete the repairs and submit signed contractor invoices and a paid-in-full receipt. The carrier then releases the recoverable depreciation as a second check — typically within 2-4 weeks. You usually have 180 days to 2 years from the date of loss to recover it.
What's the difference between ACV and RCV?
RCV pays the full replacement cost (in two checks, the second after you finish the work). ACV pays only the depreciated value and stops there. Roof endorsements often downgrade RCV to ACV after the roof reaches a certain age, even if the rest of your policy is RCV.
Got an ACV check that looks too small?
Upload your estimate — we'll show you exactly which depreciation is recoverable and what to send to get it back.
Keep reading
Why Was My Roof Claim Depreciated?
Reading the adjuster's estimate and finding the depreciation line.
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Try the calculatorGeneral information, not legal or financial advice. Settlement practices, deadlines, and endorsements vary by carrier and state.