Glossary term
RCV is the full-recovery number, and the one carrier estimates most often understate — not by disputing prices, but by leaving scope out. The omitted line item is a quieter problem than a low unit cost, and a more expensive one.
Definition
Replacement cost value is what it costs to repair or replace the damaged property with materials of like kind and quality at current prices, with no deduction for depreciation. It is the figure a replacement-cost file is built toward: the carrier pays actual cash value first, then releases the withheld depreciation once the repairs are complete and documented. RCV is a cost-to-repair number, not a market-value number — what the property would sell for is a different question entirely.
Related
The definition is the easy part. These pages cover what the term does to a file once there is money and a deadline attached to it.
The paired concept, including the depreciation holdback between them.
Open pageHow the two numbers are argued in practice.
Open pageThe pricing platforms carrier estimates arrive in.
Open pageEvery estimate read line by line, with the omissions called out.
Open pageFAQ
No. RCV is what it costs to repair or replace the damage. Market value is what the property would sell for, which reflects land, location, and demand — factors that have nothing to do with the cost of a roof. The two numbers can differ enormously in either direction.
Materials reasonably comparable to what was there in composition, grade, and appearance — not the cheapest product that performs the same function. It is a recurring pressure point, because substituting down is an easy way to reduce an estimate without visibly disputing the scope.
Typically no. On a replacement-cost policy the standard sequence is an ACV payment first, with the depreciation released after repairs are completed and documented within the policy's window. Some policies and some states vary, and a total loss is often handled differently, so the sequence is worth confirming per file.
Because a disputed unit price is visible and gets negotiated, while an omitted item is invisible and gets accepted. Reading the carrier's estimate against your own scope line by line is the only reliable way to find what was never priced at all.
Next step
Thirty minutes, live in the product. Bring a file where this term is doing real damage and we will work it on the call.
