What does Actual Cash Value mean?

It is a sum of money which represents the estimative cost of a certain property, which is either badly damaged (a building, a house) or it can also be the case of stolen properties such as cars. Such appreciative measures are usually undertaken by insurance companies, and its main goal is to establish a price at which the respective property could be sold given the current market situation.

Actual Cash Value explained

In case the policy holder loses his property to external factors such as theft, fires, or any other reason against which he is insured, the insurance company will offer him a sum which is the actual cash value of that respective property. Taking the example of a badly damaged car due to an accident, the insurer will firstly subtract such factors as devaluation of the respective vehicle and of course factors pertaining to the usage of the vehicle such as age, and the general actual condition of it. Only after these calculations will the insurer come up with the actual cash value which will be paid towards the policy holder.