ACV (Actual Cash Value) is replacement cost minus depreciation — paid first, before repairs. RCV (Replacement Cost Value) is the full amount — paid in two installments: ACV up front, and recoverable depreciation after repairs are complete and invoiced.
Key facts
- Replacement Cost Value (RCV) = the total cost to replace.
- Actual Cash Value (ACV) = RCV minus depreciation based on roof age.
- Recoverable Depreciation = RCV − ACV (paid only after repairs are completed and invoiced).
- Some policies are ACV-only — these never pay depreciation. Check your policy declarations page.
- Recoverable depreciation must typically be claimed within 6–24 months of the first payment; deadlines vary.
Step-by-step
- 1
Confirm your policy type
Check the declarations page for 'Replacement Cost' or 'Actual Cash Value' under dwelling coverage.
- 2
Receive the ACV check
First payment after adjuster approval — RCV minus depreciation minus deductible.
- 3
Complete the repairs
Work must be performed and paid before depreciation is recoverable.
- 4
Submit final invoice and completion photos
Carrier requires proof of completed repairs to release depreciation.
- 5
Receive recoverable depreciation
Final payment — closes out the claim.
Frequently asked questions
What is recoverable depreciation?+
The amount withheld from the initial check (because of roof age) that the carrier releases once you complete repairs and submit final invoicing.
Can I keep the ACV check without doing repairs?+
On an RCV policy, you collect only the ACV portion if you don't repair. The depreciation is not recoverable without completed work.
How is depreciation calculated?+
Typically straight-line based on roof age vs. useful life. A 10-year-old shingle roof on a 25-year life would be depreciated ~40%.
How long do I have to claim recoverable depreciation?+
Usually 6–24 months from the initial claim payment, depending on policy. Check your specific policy language.