# Replacement value vs. actual cash value (ACV)

> The two numbers insurers use, how Claimfrog estimates ACV, and where to see it.

- Source: https://www.claimfrog.com/help/replacement-value-vs-actual-cash-value
- Product: Claimfrog, the home inventory app for insurance claims
- Topic: Values and coverage
- Plan: Included on the Premium and Business plans.
- Updated: 2026-10-24

Insurers talk about two different values for the same item:

- **Replacement value** (replacement cost): what it would cost to buy the same or a similar item new today.
- **Actual cash value (ACV):** replacement value minus wear and tear. A five-year-old TV is worth less than a new one.

Which one you are paid depends on your policy. Many policies with replacement-cost coverage still pay ACV first and the rest (the "holdback") after you actually replace the item. Your declarations page or your agent can tell you which you have.

## How Claimfrog estimates ACV

Claimfrog uses the same approach insurers typically use:

1. Start from the item's **replacement value** (times its quantity).
2. Work out its age from the **Date of Purchase** (or the year it was made, if that's all you have).
3. Apply straight-line wear over a typical life for its category. For example, electronics over 5 years, furniture and appliances over 10 years, clothing over 4 years.
4. Never go below 20% of replacement value.

**Jewelry and watches** and **art and collectibles** don't depreciate. The calculation is done by fixed rules, not AI, so the same item always gets the same number.

## Where to see it

- **Depreciation › Insurance (ACV)** shows every item's estimated ACV, with totals and an export to PDF or CSV. Use **Show only these** to list items that still need a purchase date.
- Each item shows its **Est. claim value (ACV)** under its value.
- The [claim package PDF](https://www.claimfrog.com/help/claim-package-pdf) includes the ACV estimate.

## Good to know

- Items without a purchase date can't be estimated. Add the date (even an approximate one) to include them.
- This is an estimate. Your insurer's own depreciation schedule and your policy decide the actual payout.
- Business owners: for tax book value, see [Depreciation schedules for businesses](https://www.claimfrog.com/help/depreciation-for-business). It's a different calculation.