Replacement Value
What is it? How much it would cost you today to replace an item that was stolen or destroyed. Any item has three basic values: original cost, actual cash value, and replacement value. When you buy a homeowners or renters policy, you want your possessions to be covered for replacement value. Maybe you originally paid $400 for your living room couch, for example, but its actual cash value -- what youd get if you sold it today -- is $175. If the couch is destroyed in a fire, replacing it will cost you $800. Therefore the replacement value is $800.Added By: Emma
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