Actual Cash Value is a method for valuing property after an insurance loss. What many people do not realize about actual cash value is that depreciation is taken out of the payment from the insurance company. If you have a kitchen fire and the cabinets in your kitchen are twenty years old. The company is going to pay you for twenty year cabinets. Not what it will cost to replace those cabinets today. Most property owners prefer to insure their property at replacement cost instead of actual cash value.