Term of the Week: ACV (Actual Cash Value)

ACV — Actual Cash Value is what property was worth at the instant it was damaged: replacement cost minus depreciation for age, wear, and condition. It's the figure many policies pay first, with the recoverable depreciation released once repairs are actually done.

Why it matters: ACV lives or dies on condition evidence. Depreciate too aggressively and you underpay a defensible claim; too little and you leak. When every line item is tied to the photo that shows its real pre-loss condition — the worn south slope, the already-faded siding — the depreciation is grounded in the file instead of a gut estimate, and the ACV holds up when someone pushes back.