Replacement cost means the insurance company gives you enough money to replace the item with an item similar to what you had and for the same purpose. An example replacement cost would be if you had an expensive camera that was insured by your insurance company, and you lost your camera, you make a claim through your insurance agency and they will give you the equal amount of money to replace the camera.
Actual cash value is a little different from replacement cost the insurance company gives you the money to replace the item minus the wear and tear the item has. The insurance company takes into consideration how old the item is and the product category it falls into. An example of this would be if you lost your camera and made a claim, the insurance agency would give you less money back if the item was an older model camera, but if it were a new camera you would get more money back for your claim to replace the camera.
Replacement cost and actual cash value both get your money back to replace an item. One is not better than the other, it is a personal choice. Which would you choose if you needed to insure your personal property?