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Market value (depreciation)
Boat insurance term, area: Settlement
Market value is what the boat was worth on the day of the loss: the replacement cost less deductions for age, wear and condition. Some policies apply a fixed scale by age, for example 80 percent of new value from the second year and 50 percent from the fifth. On older boats it is often this figure that decides whether a claim leaves the owner out of pocket.
What to check: Is a total loss settled at agreed value or at market value? If market value, how is it established, and does a depreciation scale apply to sails, engines or the whole boat?
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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.
