The ACV of a total loss is the “Actual Cash Value” of the vehicle. This is different from the “Kelley Blue Book Value” in that it provides actual sale prices of the vehicle within their locale.
California requires a minimum of two comparable vehicles which are either for sale or have recently been sold. If a vehicle has not had a recent sale or is available in their locale, the report will use two separate dealer quotes for value. Arizona and Nevada have similar guidelines.
The benefit of the ACV method of valuation is that it takes a pure average of the vehicle value along with the options and conditions. Maintenance typically does not add value to any vehicle.
Gap Coverage pays the difference between what is owed on the loan and the ACV. This is a good coverage to consider if the customer has recently purchased a vehicle with a limited down payment or credit issues.
DISCLAIMER: Each claim will be handled on its own merit based on the facts presented at the time of a loss.