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Know Your Value - Comparing Actual Cash Value vs. Replacement Cost Value Insurance Policies

When purchasing your homeowner's insurance policy, it’s helpful to know that there are different options of coverage for various parts of your home, including your roof. The two most common types of coverage are Actual Cash Value (ACV) and Replacement Cost Value (RCV) policies. 

Let’s compare the two:


  • Provides coverage for the cost of replacing your roof minus depreciation

  • Will payout based on the current value of your roof

  • The age and condition of your roof is taken into account when determining how much to pay out for a claim

  • Generally have lower premiums

If you have a roof with a 20-year lifespan, and it is damaged to the point of needing a replacement after 10 years, you will likely receive about 50% of the cost of replacement.


  • Pays out the entire cost to replace your roof without accounting for depreciation, minus deductible

  • Generally have higher premiums

What should you consider when choosing the type of roof replacement coverage?

  • Age and condition of the roof

  • Weather elements where you live

  • Budget for premiums


Based in Central Florida and founded in 2020, 3MG Solutions, LLC is one of the fastest-growing residential roofer and commercial roofing companies in the country. At 3MG, our goal is to build trusted long-term relationships with our community, customers, suppliers, and corporate partnerships. We believe this positions us as the best roofer and one of the dominant roofing companies in the country. Visit us at / (407) 492-5256.


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