What does actual cash value mean in auto insurance?

Actual cash value (ACV) is a term used by car insurance companies to describe the reasonable amount that an individual’s car is worth minus any depreciation. This term is typically used if an accident takes place resulting in a complete loss. Most car insurance companies will gather information about your vehicle and its condition and offer you a settlement. In many cases it is far less than you would actually receive if your car was sold on the open market.