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Frequently asked questions

What is the difference between Replacement Cost Value (RCV) and Actual Cash Value (ACV)?

You’ve probably seen these terms before and already know that your lender requires your home policy to have coverage on an RCV basis.

To understand these terms, it is also important for you to understand the concept of indemnification. The principle of any home insurance policy is to indemnify you, which means to repair or replace your home/personal belongings to the same condition as it was before (with no upgrades or downgrades).

RCV (Replacement Cost Value) is full coverage, with no depreciation based on use or lifespan. For example, if your roof is damaged from a hail storm, you will be covered for the complete replacement of a new roof, no matter how long ago your roof was installed.

ACV (Actual Cash Value) is depreciated coverage based on the age and use. If your roof was installed 15 years ago and is covered on an ACV basis, then you would only be covered after a certain percentage of your roof is deducted by the insurance company.

Most home insurance policies* today offer coverage on an RCV basis, but if a portion of that policy is covered only on an ACV basis, it would be clearly outlined on the declarations page.

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    © 2021 Better Holdco, Inc. and/or its affiliates. Better is a family of companies. Better Mortgage Corporation provides home loans; Better Real Estate, LLC provides real estate services; Better Cover, LLC provides homeowners insurance policies; and Better Settlement Services provides title insurance services. All rights reserved.

    Home lending products offered by Better Mortgage Corporation. Better Mortgage Corporation is a direct lender. NMLS #330511. 3 World Trade Center, 175 Greenwich Street, 59th Floor, New York, NY 10007. Loans made or arranged pursuant to a California Finance Lenders Law License. Not available in all states. Equal Housing Lender. NMLS Consumer Access

    Better Real Estate, LLC dba BRE, Better Home Services, BRE Services, LLC and Better Real Estate is a licensed real estate brokerage and maintains its corporate headquarters at 3 World Trade Center, 175 Greenwich Street, 59th Floor, New York, NY 10007. A full listing of Better Real Estate, LLC’s license numbers may be found here. Equal Housing Opportunity. All rights reserved.

    Better Settlement Services, LLC. 3 World Trade Center, 175 Greenwich Street, 59th Floor, New York, NY 10007

    Homeowners insurance policies are offered through Better Cover, LLC, a Pennsylvania Resident Producer Agency. License #881593. 3 World Trade Center, 175 Greenwich Street, 59th Floor, New York, NY 10007

    Better Mortgage Corporation, Better Real Estate, LLC, Better Settlement Services, LLC and Better Cover, LLC are separate operating subsidiaries of Better Holdco, Inc. Each company is a separate legal entity operated and managed through its own management and governance structure as required by its state of incorporation, and applicable and legal and regulatory requirements. Products not available in all states.

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