When should I choose ACV over RCV insurance for my rental properties?

[Matt Wells]

I often hear people say they pick ACV over RCV insurance when the cost to rebuild would be more than the market value. I don't really understand that. Here is an example. I paid $173k for a duplex, but I have to have it insured for $300k for RCV at a $5k deductible. It's about $30 more a month for RCV insured at $300K than ACV insured at $188K. Why does it matter if it costs more to rebuild than market value if the insurance company is paying for it? Am I missing something here?  Please let me know your thoughts. I am in the process of making some insurance changes.