ACV vs. RCV Roof Insurance — What Every Indiana and Illinois Homeowner Needs to Know

The single most important thing in your homeowners insurance policy for your roof isn’t the coverage amount or the deductible. It’s three letters: ACV or RCV.

Most homeowners have no idea which one they have — until they file a claim and find out the hard way.

What RCV Means (The Good One)

RCV stands for Replacement Cost Value. With an RCV policy, your insurance pays for a new roof of similar quality at today’s prices — with no deduction for your roof’s age or condition.

Example: Your 12-year-old roof is destroyed by hail. A new roof costs $16,000.
With RCV coverage: Insurance pays $16,000 minus your deductible.
You pay: Your deductible only.

RCV policies typically pay in two stages:
1. First check: The ACV (depreciated) value — issued when the claim is approved
2. Second check: The “recoverable depreciation” — issued after you complete repairs and submit proof

You must complete repairs to get the second check. Most RCV claims in Indiana and Illinois have 1-2 years to complete repairs and claim this second payment.

Professional inspection ensures no damage goes undetected

What ACV Means (The Expensive One)

ACV stands for Actual Cash Value. Your insurance pays for what your roof was worth at the time of the loss — accounting for age and depreciation.

Same example: Your 12-year-old roof is destroyed by hail. New roof costs $16,000.
With ACV coverage: Insurance calculates your roof has used about 50% of its life. They pay approximately $8,000 minus your deductible.
You pay: The remaining $8,000+ yourself.

On a 20-year-old roof, ACV coverage may pay almost nothing.

How to Find Out Which You Have

Look at your Policy Declarations Page — the summary document typically at the front of your insurance packet. Look for the words “Replacement Cost” or “Actual Cash Value” under your dwelling coverage section.

If you can’t find it, call your insurance agent and ask directly: “Is my roof covered on a replacement cost basis or actual cash value basis?”

Quality materials and expert installation make the difference

Why More Indiana and Illinois Homeowners Are Getting ACV Than They Realize

Insurance companies have been quietly shifting older roofs to ACV coverage. Many policies now include clauses like:

• “Roofs over 20 years old covered at actual cash value only”
• “Roof coverage based on age of roof at time of loss”

If you haven’t reviewed your policy recently — especially if your roof is 15+ years old — there’s a real chance you’ve been moved to ACV without realizing it.

What to Do If You Have ACV Coverage

Short term: ACV coverage doesn’t mean you’re out of options.
– Alamo’s 0% for 18 months financing can cover the gap between your ACV payout and the full replacement cost
– Some insurance policies allow you to upgrade to RCV coverage by paying a higher premium — ask your agent

Long term: Replace your roof before it ages further. A newer roof is more likely to qualify for RCV coverage. The longer you wait with an aging roof, the worse the ACV calculation gets.

Alamo Roofing serves Lake County, Porter County & northern Illinois

The Deductible Situation in Indiana and Illinois

Even with RCV coverage, your deductible is your out-of-pocket cost. Most standard policies have deductibles of $500-$2,500.

Watch for wind/hail deductibles — separate, higher deductibles specifically for weather damage. Some Indiana and Illinois policies express these as a percentage of your home’s insured value: a $300,000 home with a 2% wind/hail deductible means $6,000 out of pocket before insurance contributes.

Alamo’s 0% for 18 months financing is the most popular way to cover deductibles — many homeowners pay it off within 12 months at zero interest cost.

How Alamo Helps

We review your policy with you at your estimate, help you understand what your insurance should cover, document all damage thoroughly, and work with your adjuster to maximize your settlement — at no charge.