When setting the value for our equipment coverage, should we insure all of our equipment and should we choose an amount equal to book value (includes depreciation) or replacement cost value?
Because your policy has a 100% co-insurance requirement, you are obligated to insure 100% of your equipment. In addition, the values that you set must be based on replacement cost valuation. This means that you should insure the equipment for an amount that would replace such equipment with a brand new piece of equipment at today’s prices. Failure to meet the policy’s 100% co-insurance requirement based on replacement cost can result in a reduced payout when a claim is filed for a partial loss.
Related Questions
- When setting the value for the equipment coverage, should all of the equipment be insured and should an amount equal to book value (includes depreciation) or replacement cost value be chosen?
- When setting the value for our equipment coverage, should we insure all of our equipment and should we choose an amount equal to book value (includes depreciation) or replacement cost value?
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