actual cash value (ACV)

In property and auto physical damage insurance, actual cash value (ACV) is one of several possible methods of establishing the value of insured property to determine the amount the insurer will pay in the event of loss.

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ACV is typically calculated one of three ways: (1) the cost to repair or replace the damaged property, minus depreciation; (2) the damaged property's "fair market value"; or (3) using the "broad evidence rule," which calls for considering all relevant evidence of the value of the damaged property.

Related Terms


Replacement cost coverage is a property insurance term that refers to one of the two primary...

The broad evidence rule is a valuation rule that has evolved in some states and does not adhere to...

Depreciation is the decrease in the value of property over a period of time, usually as result of...