Are you looking to purchase a house in Washington State? Insurance for your home and possessions is one of the factors that you need to consider before you move in. However you may have heard of the terms actual cash value (ACV) and replacement cost (RC) as varying replacement methods of insuring your house. Exactly what is the difference between the two terms and which one is the more suitable for your needs? 
Actual cash value — the economical alternative
Actual cash value (ACV) will replace your home or your possessions although it will take into account depreciation on the item. This means this type of policy won't pay the full replacement amount however as this is taken into account, premiums under this type of policy may be cheaper.

Replacement cost — the full value
In contrast, a replacement cost (RC) policy will cover the cost of replacing your home or contents at their full value (depending on whether deductibles are included) without taking into account depreciation.

Getting the right Washington State insurance for your home may depend on a number of factors. These may include your need to purchase enough to rebuild your home should disaster strike, balanced with your requirement to save money depending on your current financial situation. Feel free to discuss this with one of our agents.

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