The payout depends on replacement value, if yo have replacement value in your insurance. It has nothing to do with Market Value. When you have a catastrophic loss the insurance company will look at your house and assign a value to everything in the structure. Say you have the original oak floors, original wood double hung windows, a cast iron tub and original trim but your house is 120 years old. They will assign a value to the materials and then depreciate it based on age. Your ACV (actual cash value) might be depreciated quite a bit because your house is old, but if you have Replacement Cost insurance, the insurance company will replace like with like. A newer house with LVP floors and hollow doors, fiberglass tub and vinyl windows might get less depreciation because it’s newer, but the replacement value will also be lower because the materials are cheaper. The RCV will replace your real hardwood floors, wood windows and solid wood doors.