A valuation clause states the basis used to value insured property or a loss under the contract.
The distinction that matters
Replacement, indemnity, agreed value and other bases can produce different outcomes, subject to limits and conditions.
What to check
- Identify the settlement basis.
- Check depreciation and replacement conditions.
- Review sublimits and underinsurance terms.
Example to discuss
A business compares stock valuation and machinery replacement terms rather than assuming every asset uses its purchase price.
This is a hypothetical comparison, not a customer claim or a determination of cover.
Sources and further reading
General information only. The policy, schedule and applicable rules determine the actual position. For a personal decision, use an appropriately qualified adviser or the relevant provider.