Read about Owners Corporation Insurance Valuations

• admin
• Blog List
• October 22, 2021
• 0 Comments

Insurance is one of the most reliable and widely spared methods of protection against the risk of various troubles. The valuation of any property for insurance purposes is a key moment in a transaction with an insurance company. The number of insurance compensations and payments is determined based on an expert assessment. Insurance companies most often offer their valuation services. However, it is much wiser to contact Owners Corporation Insurance Valuations in Geelong. In this case, disputes between the insurer and the policyholder can be resolved much faster and more objectively. The objects of insurance can be:

• real estate
• movable property
• business, including lost income
• intellectual property

Purposes of Owners corporation insurance valuations

Making insurance is one of the most effective options for protecting property interests from various risks, unforeseen situations and emergencies. At the same time, an integral part when signing a contract is an insurance valuation of property, which allows you to establish an objective size:

• the total refundable amount and payments payable
• the damage caused and the amount of compensation in the event of an insured event

It is an independent assessment of the market value when drawing up an insurance contract that will help the parties to determine the market value of the insured property.

Assessment Methods and Approaches

Valuation for insurance purposes is carried out using three approaches:

Comparative- The valuation of property for insurance within the framework of the methods of the comparative approach involves the search and comparison of information about analogous objects, which are similar in their characteristics to the object of insurance.

Costly– Insurance appraisal methods used within the cost approach make it possible to calculate the cost based on the number of costs required to restore the damaged or lost part of the property.

Profitable- Using the income approach is advisable for objects that can generate income. In this case, generally accepted methods for insurance valuation can be applied: capitalization of profits, suitable for property, with a stable income stream; discounted cash flows, for a property whose income stream changes significantly each year.

The property valuation process for insurance purposes

An expert insurance assessment can be carried out both before the occurrence of an insured event when concluding a contract, and when it occurs. At the same time, any participating parties can use the services of expert appraisers. Estimation of the insured value of property occurs in three stages.

Preparatory

• Collection and analysis of information, determination of its sufficiency for evaluation.
• Analysis and description of the object of insurance.
• Market analysis.
• Selection of appropriate valuation techniques to be applied by the assessor.

The preparatory stage is one of the most important in the case when the valuation of commercial real estate is carried out, as one of the components of an existing business. At the same time, the determination of the insurance assessment for the enterprise can be carried out both for a single asset and for the entire property complex of the enterprise.

Estimated

• Calculation activities are carried out by the selected standards and methodology for assessing the cost of insurance.
• Adjustments are made to intermediate values.
• The cost is determined within each approach.
• Consistency of results between approaches.

Final

A report is prepared, which displays the cost estimate of the insurance object.

Real estate valuation for insurance is a tool that will help to avoid financial losses and compensate for the negative consequences of unforeseen situations and also guarantees a reliable evidence base for the court in case of disputes. The Owners Corporation insurance valuations service in Geelong will help you prepare a quality valuation report following the specifics of your situation.

Why do you need a property valuation for insurance?

The fact is that although an underestimation allows you to reduce the number of regular insurance premiums, in the event of a risk, the amount paid will not be enough to cover all the expenses stipulated by the contract. For the insured, this means additional financial difficulties, and for the insurance company, this situation threatens to sue for ineffective insurance.

If the assessment of the value of the property for insurance is overstated, the insured will have to pay inflated contributions, which does not mean a larger amount of payments. According to Australian law, the amount of insurance payments must correspond to the value of damaged or destroyed property or be less, but no more than the specified value. At the same time, the difference between the risk payment and insurance premiums is not reimbursed. To avoid such a situation, we recommend that you contact an insurance valuation company for Independent Evaluation to evaluate the insurance object, which is not interested in either underestimating or overstating the real value of the insured object.

The importance of asset valuation when taking out insurance

The correct valuation of the assets declared in our policies is essential to ensure correct compensation in the event of a claim. For this reason, more and more clients opt for an external professional service that allows them to establish, with technical appraisal criteria, the true value of their insured capital.

There are four major reasons commonly accepted in the insurance sector, for which it is highly recommended to hire these valuation services before signing our insurance policy:

• Specialized professionals guarantee the reliability of the previous valuation, which allows adequate risk management.
• Both the risk of underinsurance and overvaluation of assets are eliminated.
• The pre-existence of the goods is correctly accredited, which will facilitate their inventory and subsequent justification in case of loss or accident.
• Initially, it authorizes the contracted appraiser to issue appraisal certificates that guarantee the correct capitalization of the insured amounts and allows insurers to repeal the application of the proportional rule when the insured’s obligations in this regard are understood to be timely satisfied.

Thus, a professional valuation of the capital covered by the insurance will help simplify management in the event of a claim. In addition, these services are not only recommended for policies associated with tangible assets but are also very useful to cover intangible assets such as financial ones, associated with loss of profits or lost profits.

Know about the benefits of corporation insurance valuations 

If you are an owner of a commercial property and lots of people come to work there every day, then that building and those people are your responsibility. So, you should apply for property insurance to avoid any unusual circumstances. This insurance has many benefits, such as:

Disaster Recovery:

The longer your business operations are interrupted or slowed down, the worse the situation is likely to get. If you suffer an insured loss, having the right policy will help you get back to business quickly and therefore mitigate the long-term consequences of the loss. By reducing your business downtime, you also protect your reputation with your customers.

Repair costs:

If your business suffers an insured loss, your business property insurance policy may cover some of the repair costs. For example, if someone vandalizes the door to your business premises, making the building inaccessible to your customers, your insurance policy can help you get repairs done quickly and protect your business profits.

Replacement costs:

If your business suffers a loss where the damage is too great to repair, business property insurance can help replace the damaged property. For example, if a flood occurs in your office kitchen and destroys some of your cooking appliances, your business property insurance policy will help you replace the damaged property with new equipment.

Business Interruption Insurance:

If you suffer an insured loss, you will likely have to close shop for some time or interrupt part of your business operations. The right business property insurance policy can replace a reduced or interrupted source of income to help you pay bills, wages and other expenses until you get back on your feet.

Unpredictable claims:

Despite your best efforts, some things remain beyond your control. Natural disasters, such as fires, winter storms, hail and floods can cause unexpected property damage. Your business property insurance policy may cover damage caused by forces beyond your control.

Conclusion

As you can see, there are diverse benefits to getting a current property insurance valuation. It gives you the confidence to know you have the right coverage at the right rating. It supports better, more streamlined processes with your reinsurer/insurer. And it forms an important basis for more accurate trending for years to come. Do you need to hire this service? Contact Delorenzo Property Group. Our office is staffed with highly trained professionals with years of experience in the industry. Get in touch with us!