How to use the actual cash value calculator
Pick one item or one part of your home, like a roof, a sofa or a laptop. Look up what a similar new one costs today. Then estimate its age and how long items like it usually last. Add your deductible, and the tool shows both possible payouts.
For a full room or home, run the tool for your most valuable items and add the results. A home inventory makes this much easier; the Insurance Information Institute explains how to make one.
A second worked example
What the result means
The difference is how much more a replacement cost policy might pay for this loss. A large difference on items you own a lot of, or on your roof, is a sign to ask your insurer what replacement cost coverage would cost. A small difference, or one you could cover yourself, may make ACV coverage good enough.
Keep in mind that this tool looks at one loss at a time. Over the life of a policy, the question is how many older things you own and how likely a large loss is where you live. If most of your belongings are several years old, the total difference across all of them can be much bigger than any single result here.
ACV vs. replacement cost
| Feature | Actual cash value | Replacement cost |
|---|---|---|
| What it pays | Replacement cost minus depreciation | Cost to replace new, at today’s prices |
| Deductible | Yes | Yes |
| Older items | Pays much less | Pays the same as for newer items |
| Premium | Usually lower | Usually higher |
| How payment works | One payment | Often ACV first, the rest after you replace |
For what each part of a homeowners policy covers, read homeowners insurance coverage explained. Renters can see renters insurance explained.
State and program rules that change the answer
States regulate how claims are paid. The Texas Department of Insurance shows a 10-year-old roof example: replacement cost coverage would pay $8,000 on a $10,000 roof after a $2,000 deductible, while ACV coverage might pay $5,000 (Texas Department of Insurance, last updated June 1, 2026). It also says most replacement cost claims are paid in two checks, with depreciation paid after the work is done. Flood insurance is different: belongings are covered only on an ACV basis (Insurance Information Institute, accessed October 2026). See flood and earthquake insurance for more. Your state insurance department can explain the claim rules where you live.
Common mistakes
- Using the price you paid. Use today’s price for a similar new item.
- Assuming replacement cost pays all at once. Keep receipts to collect the held-back amount.
- Forgetting the deductible. Small, older items may pay nothing on an ACV policy.
- Ignoring roof schedules. Some policies pay roofs on ACV even when the rest is replacement cost.
- Treating this as the insurer’s number. Real depreciation schedules differ.
When does ACV vs. replacement cost matter most?
The gap between ACV and replacement cost grows with age. It matters most for things that wear out and are expensive to replace, such as roofs, flooring, appliances, electronics and furniture. It matters less for newer items, or for items that keep their value well.
It also matters after a large loss, such as a fire or a major storm, when many items need replacing at once. In that case, depreciation on dozens of items can add up to a large amount you would have to pay yourself on an ACV policy. Renters with many older belongings can face the same issue on a smaller scale.
Questions to ask your insurer
- Does my policy pay replacement cost or actual cash value for the home, and for my belongings?
- Is my roof covered on a replacement cost basis, or on a separate schedule?
- If you hold back depreciation, how long do I have to repair or replace and claim it?
- What would it cost to switch from ACV to replacement cost coverage?
- Which items have special limits, such as jewelry or collectibles?
Use the answers, along with a home inventory, to decide whether the difference this tool shows is worth insuring.
Related tools
To estimate how much renters coverage you need, try the renters coverage estimator. For hurricane or wind deductibles that are a percentage of your dwelling limit, use the percentage deductible calculator.
