Valuation for insurance

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tillergirl

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After 20 years the insurance company want a condition survey and independent valuation. Condition survey simples: valuation, err that's a little more difficult. I have a 52 year old wooden boat; not a pedigree, of course not like a modern boat. Selling price? Hardly likely to be sold for a lot of money. But if I lost her to find her spec again would be substantially more. She is modernly equipped - new sails, good condition engine, calorifier, holding tank, cooker (all recent), new saloon bunks and covers, solar panels, shorepower, PROPER seacocks etc etc. I reckon I would need a replacement in that condition or fitted up to that spec would require at lest three times what I could sell her for. So how much should the valuation be set for?
 
Is the "valuation" not defined in the contract? If it is, then that is what governs, regardless of how any of us feel about the amount of cash we have ploughed into our boats.
 
A real problem with old boats where the market value is so far apart from replacement cost (or even the cost of a relatively simple repair). Suspect you will have to negotiate and agreed value with your insurer, perhaps with the help of your surveyor and a statement of all the costs of recent gear. However, think you have to accept that any significant damage is likely to result in a claim exceeding the insured value.

Good encouragement to take care of your boat!
 
tillergirl said:
Hardly likely to be sold for a lot of money. But if I lost her to find her spec again would be substantially more.
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I do not quite understand how those two predictions add up.
Unless perhaps you mean finding a run down boat of the same age and type as a replacement and then investing a lot to get her up to spec.
But I would like to think there is indeed a market value for an old boat that is well kept and updated – and that this value would be about the same whether seen from the buyer´s och the seller´s point of view.
(Speaking as someone who is trying to do the same with a boat only 36 years old).
 
They use an " Agreed Value " system in Classic Car and Motorcycle insurance. Often an authorotive organisation such as the VSCC, the VMCC or one make clubs or registers are used as a balance-to stop owners putting values that are too high on their pride and joys.

I suspect this will be a non starter with boats, but it might be worth asking your insurance company.
 
I agree with the point by 'BY' and indeed rotrax. The insurance company will have 'an agreed valuation' and no further explanation. The dilemma is the investment in an old wooden boat. The things I have added do not really add to the market value. The second hand market is significantly depressed. I guess with the depressed market, I would probaly only get a third of my current valuation (based upon the 1998 survey) . I hope I am wrong even though the survey could barely find any blemishes. The trouble is if the insurance value is the market value it will quickly reach the limit of economic repair in the event of serious damage.
 
I have looked through the terms and conditions of my own insurance policy and I can not find 'market value' mentioned.
Instead, the terms 'agreed fixed value' and 'maximum insurable value' are used, defined as 'the current new replacement value (the actual cost of replacing insured property with new objects of the same kind and quality'.
So my conclusion is that at least some insurers might be willing to agree on an insurance value that relates more to the (higher) replacement cost than to the (lower) current market value.
You should shop around, I guess.
 
Technically, traditional marine insurance does not insure the vessel, but your investment in it and any cargo. Hence there are still some policies where, should you wish, you can be insured up to the original purchase price.

I am in the same position, having had an older wooden vessel for same time. Despite the fall in the market, my insurer (Simon Winter, no connection etc) is still happy to insure for the same amount as when I bought her 18 years ago. Yes, it costs a bit more, but a darn sight less than if an accident occurred tomorrow and she was written off for the sake of a relatively minor repair - after all just a new mast, or professional replacement of two full-length planks would probably cost about half the current market value of the entire boat.
 
A number of years ago we bought an old boat, spent a lot of time and money doing her up, after which we discussed an increased valuation with the insurers (GJW) above the current value which was based on our purchase price
, they were happy to increase the insured value based on the purchase price plus a list of expenditure and estimates of what the labour would have cost if done professionally. Some time after that she was badly damaged and they paid out almost her insured value for repairs. So long as you agreed the value with them and have a reasonable basis for that you shouldn't have a problem, but make sure the agreement is in writing.
 
Expensive carry on these boats arnt they...How much is a survey nowadays ?
could do with one on mine A waterwitch looks very similar to yours!
 
Your surveyor should be able to put the value on the boat its that simple. Insurers will agree or not.

dombuckley said:
Technically, traditional marine insurance does not insure the vessel, but your investment in it and any cargo. Hence there are still some policies where, should you wish, you can be insured up to the original purchase price.

I am in the same position, having had an older wooden vessel for same time. Despite the fall in the market, my insurer (Simon Winter, no connection etc) is still happy to insure for the same amount as when I bought her 18 years ago. Yes, it costs a bit more, but a darn sight less than if an accident occurred tomorrow and she was written off for the sake of a relatively minor repair - after all just a new mast, or professional replacement of two full-length planks would probably cost about half the current market value of the entire boat.
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At the risk of being pedantic, a marine policy is always an agreed value policy. The underwriters agree the value with the assured and if the boat is lost, that is what they will always pay. If the boat is damaged and the cost of repair seems likely to exceed the agreed value, they underwriters will "decline Notice of Abandonment" and pay the agreed value as a Constructive Total Loss ("CTL").

Sails and covers however are not treated as agreed value items. A depreciated figure is paid for these.
 
Speaking as a pure amateur but one who completed the Yacht and Small Craft Surveying Course at the IBTC I am sure that we were instructed that surveyors should not pass any judgement of the value of a boat in the course of a survey.

However; the definition from our esteemed (and published) instructor reads, under types of survey:

Valuation: Not a survey but a brief limited inspection based on strictly defined assumptions to provide a Value.

Such an inspection would typically include wording to the effect that:

"This valuation is not a survey and is based upon the assumption that a full condition survey would not reveal any major defects substantially affecting the boat's value".
 
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No idea if they are any good in the event of a claim but Saga were happy to insure me for my idea of value and didn't ask for a survey even though the boat was about 40 years old.
 
gordmac said:
No idea if they are any good in the event of a claim but Saga were happy to insure me for my idea of value and didn't ask for a survey even though the boat was about 40 years old.
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Thanks for that.

Just done their online quote request and it does seem remarkably simple.

I suspect it would blow a fuse if I entered the true replacement cost of a 25ft 3in Vertue. Just the hull, deck and coachroof around £150k (and that is in iroko, not teak). Then there is the rig, deck fittings, engine and interior fit to consider.........
 
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