Valued Policy

Posted: Thu Aug 09, 2007 04:55 pm Post Subject: Indemnification for a valued policy

How to caculate for the indemnity amount of a destroyed property under a valued policy

Posted: Fri Aug 10, 2007 05:47 am Post Subject:

The purpose of indemnity is to restore you back to the same financial condition as you were before the loss occurred. The insurance company can consider calculating the loss in any of the following ways

• 
  
• Repair-this is probably the most common form of ‘loss calculation'. The insurer will only pay the amount requires to repair the damaged property.
  
• Replacement- this process is used if the property suffers complete destruction or 'stolen and un-recovered'. The insurer will replace the insured item no-matter what it cost.
  
• Reinstatement- the insurer will reconstruct the damaged property with exact specification.
  
• Cash payment- If none of the above options suites you, the insurer will issue you a check for the damage. This one, however, is the most common form of claim settlement.
  

Posted: Fri Aug 10, 2007 06:16 am Post Subject: Indemnty Calculation

Hi!
There are several factors that may influence the calculation of the indemnity amount. If you are interested in restoring back the insured item then the indemnity value will be calculated as cost of re-construction of the property minus any depreciation.

or, If you can prove that you were interested in selling your property at the time of the loss then the amount will be calculated upon the market value of the property minus the site value.

Regards,
Fatman