Auto Book Value

The auto book value refers to the value of the vehicle according to Kelley Blue Book, Black Book, or the National Automobile Dealers Association (NADA). This is typically the first resource insurance companies consult when calculating the ACV of a damaged vehicle.

Fair Market Value

Fair market value refers to the wholesale or retail value of the damaged vehicle. The fair market value is often lower than the vehicle’s book value, which in turn affects the ACV.

Replacement Cost

If the car is new or relatively new, the insurance company might consider the cost of replacing the damaged vehicle with a new vehicle of the same model or a similar model. This typically applies to vehicles one year old or newer, while vehicles older than one year old are not usually replaced.

State Specific Requirements

The actual requirements for calculating ACV vary by state. If you have recently been involved in a car accident, contact your state Insurance Department for information specific to your state. Knowing your state requirements for calculating ACV can help you to avoid being taking advantage of by your insurance company.

Calculating Your ACV

You can calculate your own ACV by consulting the Kelley Blue Book, Black Book, or NADA. You can also contact a car dealer for information regarding a trade-in, in which case, you should request all quotes recorded in writing. That way, if you feel that your insurance provider is offering an unfair sum, you have documentation to support this claim.