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ACV Depreciation Calculator

Calculate actual cash value (replacement cost minus depreciation) and compare ACV and replacement-cost claim payments.

How the acv depreciation calculator works

Actual cash value is replacement cost less depreciation for age and wear. ACV policies pay this amount; replacement cost policies pay ACV first and the withheld depreciation once the item is replaced.

Formula

ACV = Replacement cost × (1 − min(Age ÷ Useful life, Maximum depreciation)).

How to use it

1. Enter replacement cost, age and useful life.
2. Enter any depreciation cap.
3. Enter the deductible to compare claim payments.

Worked example

An $18,000 roof, 7 years into a 20-year life, is 35% depreciated: ACV $11,700, paying $10,700 after a $1,000 deductible.

Frequently asked questions

What is recoverable depreciation?

On a replacement cost policy, the depreciation withheld at first payment, released once repair or replacement is complete.

How is useful life decided?

Adjusters use depreciation guides by item type; condition and maintenance can adjust it.

Guides

• How to Choose a Deductible: Break-Even Years and Expected Cost

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