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Agreed value
Boat insurance term, area: Settlement
An agreed value is a sum fixed in the policy that counts as the boat's value if she becomes a total loss, with no deduction for age. Without it the insurer works out market value on the day of the loss, meaning the value after depreciation, and for a boat ten years old that is regularly well below the sum insured. Even so, an insurer can usually challenge an agreed figure that is far above the boat's real worth, so it should reflect a realistic replacement cost, ideally backed by a surveyor's valuation.
What to check: Is the hull insured on an agreed value or a market value basis? Does the agreed value hold for the life of the policy or only for a set number of years, and how are partial losses settled?
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A general explanation in our own words.
What applies to you is set only by the wording of your own policy.
