Short answer
Actual cash value (ACV) is what the truck is worth at the time of loss, usually replacement cost minus depreciation or market value. Stated amount is the value you list for the truck on the policy, and on most truck physical damage forms it works as a ceiling: the insurer pays the lesser of the stated amount, the actual cash value, or the cost to repair. Stating a high value does not guarantee a high payout.
- Agreed value is different: it is a value the insurer accepts up front. Read the valuation clause to know which one you have.
How each one works at claim time
IRMI describes actual cash value as one of several ways to value insured property, using replacement cost minus depreciation, fair market value, or a broad look at all evidence of value. For a used tractor, that usually means what a comparable truck would sell for.
Stated amount is the dollar figure on your schedule. On a typical stated amount form, a total loss pays the lowest of:
- The stated amount
- The actual cash value at the time of loss
- The cost to repair or replace with like kind and quality
So if you list a tractor at a value above what the market says it is worth, you pay premium on the higher number but collect on the lower one. If you list it below market, the stated amount caps what you collect.
| Method | What sets the payout | Watch for |
|---|---|---|
| Actual cash value | Market or depreciated value at the time of loss | Disputes over comparable trucks |
| Stated amount | Lesser of stated amount, ACV, or repair cost (on most forms) | Overstating value raises premium without raising payout |
| Agreed value | The value accepted by the insurer when the policy was written | Less common; often needs appraisal or documentation |
Keeping the stated amount honest
Because trucking physical damage is often rated on the stated amount, the number deserves an annual check:
- Update values when you buy, sell, or add equipment like sleepers, APUs, or reefer units.
- If a lender or lessor requires a value, compare it to market. Loan balances and market value can drift apart.
- For trailers, confirm whether the reefer unit is included in the trailer value or scheduled separately. See reefer trucking insurance.
If you lease to a motor carrier, physical damage is usually your responsibility, not the carrier's. See who insures a leased owner-operator.
Common questions
Is stated amount the same as agreed value?
No. Stated amount is usually a ceiling, and the insurer still pays the lesser of that amount or actual cash value. Agreed value fixes the payout in advance. Read the valuation wording in your physical damage form.
Should I lower my stated amount to save premium?
Only if the truck is really worth less. Setting it below market caps your recovery on a total loss.
Does physical damage cover what I still owe on the truck?
Not necessarily. If the loan balance is higher than the payout, you owe the difference unless you have separate gap coverage.
Sources
- IRMI glossary: actual cash value. Definition and common methods of determining ACV.
- IRMI glossary: motor carrier policy. ISO motor carrier form includes auto physical damage among its coverages.
This page explains insurance, not law. Have your attorney review indemnity and contract language; our job is making the insurance match it.
Keep reading
Coverage
Physical damage: how your own truck and trailer get paid for after a loss
Questions
Who insures a leased owner-operator?
By operation
What insurance does a Texas reefer carrier need?
Contracts and deadlines
Our trucking insurance renewal came in high. How do we find out why, and what can we change?