Which method values a property based on current selling prices?

Market value is defined as the amount for which a property would sell in a competitive and open market, reflecting current selling prices for similar properties. This valuation considers various factors, including the location, economic conditions, and the characteristics of the property itself. It is a commonly used approach in real estate and insurance to determine how much someone could reasonably expect to get if they sold their property.

In contrast, other methods like agreed value involve determining a fixed amount that the insurance company and the policyholder agree upon for coverage, independent of current selling conditions. Replacement cost focuses on the cost to replace the property with a similar one at current market prices, while functional replacement refers to rebuilding a property using less expensive materials that fulfill the same function. Therefore, market value is specifically tied to current selling prices, making it the correct choice in this context.