Actual Cash Value loss settlement applies to a single-family dwelling not subject to replacement cost or special loss settlement, at the time of loss, when the amount of insurance is both less than 80 percent of its full replacement cost immediately before the loss and less than the maximum amount of insurance available under the NFIP. In that case, the insurer will pay the greater of the following amounts, but not more than the amount of insurance that applies to that dwelling: the actual cash value of the damaged part of the dwelling or a proportion of the cost to repair or replace the damaged part of the dwelling, without deduction for physical depreciation and after application of the deductible. The types of properties that are subject to ACV loss settlement include: |
- A two-, three-, or four-family dwelling
- A unit not used exclusively for a single-family dwelling
- Detached garages
- Personal property
- Appliances, carpets, and carpet pads
- Outdoor awnings, outdoor antennas or aerials of any type, and other outdoor equipment. Note: Outside air-conditioning condensing units are payable at RCV, if applicable
- Abandoned property
- A dwelling that is not the policyholder’s principal residence
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| Note that if the policyholder qualifies for replacement cost benefits, the depreciation of these items is not recoverable. |
