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Replacement Cost insurance vs Actual Cash Value

Replacement Cost insurance vs Actual Cash Value

What is the difference?

Replacement cost insurance pays for the full value of the item.  In other words, it’s new for old.  On the other hand, actual cash value insurance pays for the depreciated value of the item.  For example, your bike which you paid $1,000 10 years ago was stolen, under the replacement cost wording, the insurer would replace your bike with a new bike of like kind and quality.  Alternatively, under the actual cash value wording, the $1,000 bike would be depreciated based on its 10 year life span.
 
  • Rasoul K.

    What our clients say

    After talking to many different insurance companies, I spoke to Ensurco New Business Team. They returned my call quickly, provided the best rate and helped me set up a home insurance policy within an hour. Great service!

    Rasoul K.