A contractors equipment policy may pay losses based on either of two values: the actual cash value of the damaged property, or the cost or repair or replace it. (thebalance.com)
Another aspect that should be considered is whether your policy pays the actual cash value of damaged property, or the replacement cost. (usinsuranceagents.com)
With actual cash value, the insurance company pays you an amount equal to the replacement value of damaged property minus a depreciation allowance. (ufcu.pfyfn.com)