ACV or RC?
Actual Cash Value vs Replacement Cost
ACV pays depreciated value, RC pays new-for-old. The difference can be 50% of your payout. Check yours in 60 seconds.
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The short answer
ACV pays what your item is worth today after depreciation. RC pays the cost of replacing it new. ACV is cheaper to insure but routinely pays 40–60% less on contents claims, especially electronics, furniture, and clothing.
When ACV is acceptable
Roofs in hail-prone areas (insurers often only offer ACV). Otherwise, almost always go RC for contents.
Frequently asked
- Can I add RC to an ACV policy?
- Most insurers let you upgrade contents to RC for a small premium increase.
- Does RC pay upfront?
- No — usually ACV first, with RC top-up after you actually replace the item.
Your policy is the only source of truth
Stop guessing. Check your actual policy.
Generic answers don't pay claims. PolicyPal reads your policy wording in seconds and tells you, in one sentence, whether you're covered.