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Salvage value (residual value), in the boat insurance glossary
Boat insurance term, area: Settlement
After a serious loss, what remains of the boat or of a damaged part usually still has a price: a burnt-out hull, the engine of a sunken boat, a broken mast sold for scrap. That figure is the salvage or residual value. Insurers normally deduct it from the settlement where the owner keeps the remains. Disputes tend to turn on who sets the value and whether it is the price actually obtained or merely one that could be obtained. Owners sometimes assume they can hand the wreck over and claim the full sum; many wordings do not allow that.
What to check: Is the deduction taken from the proceeds actually achieved or from an estimated obtainable value, and who obtains the bids? Can you require the insurer to take over the wreck, or does the wording rule out abandonment?
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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.
