Depreciation is not an issue when determining insurability. THat is why an insurance
company will allow you to insure something with a much larger stated value than what it is actually worth. When this comes into play is in a total loss situation. If you were to value, say a 1990 Catalina 30
at $100000.00, you would pay premiums on that hundred thousand dollar value. If the vessel becam a total loss, you would only be paid on the current
market value of the boat. Even though you had been paying premiums on $100000.00. An FYI, if you have a 4 year old car that you have had full coverage on since it was new, at say, a value of $20,000.00. Get the blue book value, and call your insurance
company. You will probably save some money
Another little known fact, at least here in Ca, is if you have something over insured, such as the Catalina
, if the boat is totaled, and you do not retain salvage
, the insurance company will sell the salvage
. After the sale
, you are due a percentage of that salvage equal to the percentage you were over insured.
With insurance, the best way to get a deal is to be proactive. Most insurance companies are very willing to pay out on a claim withing the policy rules, but the expectations of the insured are often based on what the insured wanted when he bought the policy, not what the policy actually says. Read the fine print. Insurance companies as a whole are not as unscrupulous as you might think, but insurance salesmen are salesmen. As with any salesman, you will not be given answers unless you ask the right questions.
For example: You tell your broker you want to save money
on your policy. He asks how much you owe on the vehicle. You have paid half down, and owe $10000.00. He sets your policy up based on $10,000. You get into an accident
leaving his office, and total your car. You are now out $10000, as all you insured was the amount owed, not the actual value of the car that was $20000. You might have saved 20% on your premium, and the broker gave you exactly what you asked for, but it cost you.
THere are allot more, but you get the drift.