Find the replacement amount
Locate the replacement-cost figure in the relevant estimate and compare its work scope with the contractor’s quote. Do not treat a sale price, premium or policy limit as the same input.
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ACV versus RCVSee the gap between the contractor quote and the insurance check
Replacement cost is what the work costs today. Actual cash value subtracts age and wear. Enter the four numbers that control the difference and watch the settlement build itself.
Method reviewed August 2026
See the illustrated project guide
Written and maintained byMantu Kumar
Evidence review4 August 2026
Calculation rulesRead the methodology
Quality standardEditorial policy
Insurance claim gap calculator
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Put the quote and claim documents side by side
The important comparison is between matching scopes. A contractor’s project price and a claim payment may describe different amounts or stages.
The three detail views below enlarge parts of the same photograph. Use them with the planning checks. Photos are AI-generated illustrations, not installation instructions or actual claim records.
Keep depreciation and deductible separate
Use the age, expected life and deductible fields to explore this page’s model. Its straight-line depreciation assumption may differ from the schedule or terms in your claim documents.
Distinguish first payment from final payment
Ask the insurer which amounts are payable now, potentially recoverable later, excluded or capped. A modeled gap is not proof of underpayment or a promise of additional payment.
Before comparing totals, ask for these details
- Matching scope
- Same damaged items, quantities and repair/replacement work
- Policy details
- Applicable deductible, coverage terms and depreciation method
- Payment stage
- Initial payment, conditions for later payment and deadlines
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Planning illustration, not a promise of coverage
The calculator uses straight-line age depreciation capped at 80%. A carrier may use a condition-based schedule, a roof-surface endorsement, a payment cap or different useful life. The written policy and claim estimate control.
Worked example: why $16,805 can become $4,652
An 18-year-old architectural shingle roof is estimated at $16,805 to replace. At the 28-year expected life this site uses for architectural asphalt, straight-line depreciation is 64.3%. That leaves about $6,002 of actual cash value. Subtract a $1,350 deductible and the first check is about $4,652.
On an ACV-only policy, the unrecovered portion remains with the homeowner. On an RCV policy, eligible depreciation may be held back and paid after replacement is completed and documented. The deductible remains the homeowner’s share in either path.
In this guide
Where to find the four numbers
Replacement cost
Use the carrier’s replacement estimate or a written contractor quote with comparable scope. Check that removal, disposal, permits, code items, access, flashing, trim and related repairs are either included or clearly excluded.
Age and expected life
Age may come from permits, invoices, inspection reports or the carrier file. Useful life varies by material and the depreciation schedule being applied. Change the useful-life input until it matches the schedule shown on the adjuster estimate.
Deductible
Use the deductible that applies to this loss. Wind, hail, hurricane or named-storm deductibles can differ from the standard all-perils amount and may be expressed as a percentage.
How to read the animated result
The result separates the claim into four layers: replacement cost, depreciation, the deductible and the payment. The two colored paths then show the practical difference between stopping at ACV and completing an eligible RCV claim.
| Result | What it means |
|---|---|
| First check | Estimated ACV after the deductible. This is often the payment visible before completed work. |
| Recoverable depreciation | The eligible holdback that may be released under RCV terms after documented replacement. |
| ACV homeowner share | The difference between replacement cost and the first check. |
| RCV homeowner share | Usually the deductible, subject to coverage, limits, scope and what was actually spent. |
Questions to ask before work starts
- Is the damaged item settled at ACV or RCV under the controlling endorsement?
- How much depreciation is recoverable, and what deadline applies?
- What invoices, photos, permits or completion documents must be submitted?
- Does the estimate include code upgrades, matching and all affected adjacent materials?
- How will supplements be reviewed if hidden damage changes the scope?
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Claim gap questions
What is the gap between replacement cost and actual cash value?
It is the portion of today’s replacement cost not included in an ACV payment after depreciation and the deductible. On an RCV claim, eligible depreciation may be recoverable after completed work; on an ACV-only claim it generally remains your share.
Why is the first insurance check smaller than the contractor quote?
The first check may subtract depreciation, the deductible and non-covered items. It can also reflect a narrower scope than the contractor quote. Compare the two line by line, not only by total.
What is recoverable depreciation?
It is the amount held back from the initial ACV payment that may be released on an eligible RCV claim after repair or replacement is completed and documented.
Is the deductible subtracted before or after depreciation?
Claim estimates commonly show replacement cost, subtract depreciation to reach ACV, then subtract the deductible from the payment. The carrier estimate and policy language control the actual presentation and settlement.
Where do I find whether my policy is ACV or RCV?
Check the declarations page and the endorsement covering the damaged property. Look for replacement cost, actual cash value, roof surface schedule or cosmetic damage wording. Ask the carrier to identify the controlling form if it is unclear.
Can depreciation be more than 80%?
Specific schedules and forms can differ. This planning tool caps straight-line depreciation at 80% so the item retains a 20% residual value; it does not reproduce a specific carrier schedule.
Is this an insurance coverage decision?
No. It is a planning illustration. The policy, endorsements, cause of loss, adjuster estimate and completed-work documentation determine the real payment.
Summary
Replacement cost answers, “What does the work cost today?” Actual cash value answers, “What was the damaged item worth immediately before the loss?” The deductible and recoverable depreciation connect those numbers to the checks you receive. Run the physical estimator first, compare scopes line by line, then use this calculator to see both payment paths.
Related
- Roof replacement cost — the claim this tool is most often run for
- Roof damage: what to do first — documenting the loss before you file
- What insurance actually pays — the claim process end to end
- Taxes and financing — how people cover the gap
- All replacement estimators — get a replacement figure to feed in here
Where this method comes from
The calculation follows how carriers actually settle a claim: replacement cost less straight-line
depreciation for age against the item's expected life, floored at a 20% residual because most
carriers do not depreciate to zero, then less your deductible. The difference between that first
check and the full replacement cost is the recoverable depreciation, which a replacement cost
policy releases once the work is finished and an actual cash value policy never pays.
Expected lifespans match those used across the estimators on this site. Carriers vary —
some apply their own depreciation schedules, some cap payouts by age, and wind and hail often
carry a separate percentage deductible. This is a planning estimate, not a coverage determination.
Evidence trail
Reviewed 4 Aug 2026Sources used to check this model
Primary public references anchor ACV, replacement-cost and deductible terminology. The calculator is a planning model; the written policy and carrier estimate control the claim.
Core definitionsNAIC: ACV and replacement cost
Consumer guidanceNAIC homeowners insurance
Local regulatorNAIC state insurance departments
These organizations do not endorse ReplaceCost. The written policy, adjuster estimate, contractor scope and applicable state law control the real result. See the full methodology for the source hierarchy and update process.