Most businesses are constantly growing and changing. Your commercial insurance needs to stay in step as your company continues to develop.
Acquiring new equipment, hiring new employees, or purchasing new office space may all impact your insurance needs. Regular valuations help guarantee your business remains adequately insured.
What is an Insurance Valuation?
An insurance valuation determines the value of your business’s property. Your company property includes buildings, land, machinery, equipment, and other furnishings (desks, computers, phones, etc.).
Having correct and frequent valuations means that you will be fully protected in the event that company property is damaged. An improper valuation can lead to expensive repair or replacement costs not covered by insurance.
Types of Valuations
Insurance companies typically use two different methods for valuations.
Replacement Cost determines the total cost to replace damaged property. A replacement cost calculation includes the money needed to construct new buildings, replace damaged equipment, and purchase new furnishings.
Actual Cash Value is similar in its replacement cost calculation but also factors in depreciation for age and wear and tear. Therefore, this valuation method typically results in less coverage than the former.
Each valuation method has advantages and disadvantages, and your insurance agent will help you determine the right fit for your business.
In light of the terrible Marshall Fire near Boulder, CO last year and the rapidly increasing costs of construction over the past several years, we are taking a hard look at property coverages for all of our clients.
Please contact Steve Longenecker (303-808-9351, x2) at Mountain Insurance: Longmont to discuss your business insurance coverage options in Longmont, CO, and our neighboring communities.
We give out $25 gift cards for referrals that become our insurance clients.
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