# ACV vs Replacement Cost: how does it affect a roof claim?

*Published 2026-05-31T09:00:00-07:00 · Updated 2026-07-18T09:00:00-07:00 · Best Roofing Answers*

## Answer

Replacement Cost Value (RCV) policies pay what it costs to install a new roof today, while Actual Cash Value (ACV) policies pay RCV minus depreciation — meaning ACV on a 20-year-old asphalt roof often pays only 20–40% of the replacement cost, with the homeowner covering the rest.

## How the depreciation math works

Per III guidance, most insurers depreciate a 30-year asphalt shingle roof on a straight-line basis: a 20-year-old roof carries ~67% depreciation, so an $18,000 replacement pays roughly $6,000 ACV before deductible. RCV policies pay the full $18,000 (minus deductible), often in two installments — the ACV portion up front and the depreciation released when the work is completed.

Many carriers in hail-prone states have moved older roofs to ACV-only automatically at renewal. Ask your agent whether your roof is on RCV or ACV, and whether you have a 'roof surfacing settlement' endorsement.

## Also asked as

- actual cash value vs replacement cost roof
- will insurance pay full replacement for old roof
- roof depreciation insurance
- ACV vs RCV roof claim

## Sources

- [III (Insurance Information Institute)](https://www.iii.org/)

## Related

- https://bestroofinganswers.com/insurance/roof-damage-coverage
- https://bestroofinganswers.com/q/does-homeowners-insurance-cover-hail-damage
- https://bestroofinganswers.com/q/roof-insurance-deductible-explained

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Author: Best Roofing Answers — https://bestroofinganswers.com/about
Published: 2026-05-31T09:00:00-07:00
Modified: 2026-07-18T09:00:00-07:00
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