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Determining Insurable Value for Equipment and Machinery

September 1, 2010

It is important for any type of business to carry various forms of insurance that can cover a business owner in case of damage to the company’s property and equipment. Although an insurance company will establish its own value of the business’s assets to determine a necessary amount of coverage, it is important that the business owner also establishes his or her own insurable value of the assets. The insurable value of assets can be used by businesses and their insurance providers to determine how much insurance should be carried. 

By determining insurable value, a certified machinery and equipment appraiser can help a business determine the proper amount of insurance to be carried. Documenting insurable value of a business can also be helpful for a company interested in borrowing money. Knowing this value can give a lender additional peace of mind because the lender will know that in the event of a catastrophe, the insurance held will assist in the business’s recovery. 

By: NEBB Institute

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