Homeowners insurance policies offer actual cash value or replacement cost coverage to replace your damaged, stolen, or destroyed personal property. Refer to your policy or talk with you insurance agent to determine which type of coverage you carry on your home. Most policies in our market area are Replacement Cost Coverage.
- Replacement cost is what you would pay for the item at today’s cost.
- Actual cash value is what you would pay for a similar item at today’s cost minus depreciation (replacement cost minus depreciation).
- Depreciation is a decrease in value due to wear and tear or age.