What does Actual Cash Value mean? Read on to discover the definition & meaning of the term Actual Cash Value - to help you better understand the language used in insurance policies.
Actual Cash Value
Actual cash value (ACV) is one way that insurance companies measure the worth of assets for an insurance claim. They consider a fair market price of what the asset could have been sold for on the day it was lost, stolen, or destroyed. This typically comes out to a lower amount than the policyholder originally paid for the asset because assets lose value over time due to depreciation and wear and tear.
We hope the you have a better understanding of the meaning of Actual Cash Value.