Fire, flood, tornado, earthquake, hurricane. No matter what the cause of loss, most often there is property and inventory that is only partially damaged. While some policyholders may view the damaged property as useless, to others damaged property holds great value and opportunity. No matter how you look at it, if surviving property has some salvage value, that value will apply directly to that claim’s loss adjustment calculation.
The value of salvage is considered by an insurer as a “credit” against what they owe you for an insured loss, based upon the terms and conditions of your policy. The calculation is simple: Amount of recoverable insured loss - Salvage value = Net payment to policyholder.
Dealing with salvage after a loss can have a large impact on an insured’s overall recovery. This issue of Adjusting Today provides a detailed look at the salvage process and how it applies to an insurance claim. Veteran professional loss consultant Robert Luongo takes an in-depth look at the salvage process and how its handling can affect the outcome of insurance claims.
For business owners of all types, this piece will enlighten anyone who has the potential for a salvage operation following an insured property loss.
Stephen J. Van Pelt, Editor