For the claim lodged in insusance for flood damage, their surveyor assessed the machinery damage as per below. Plz advise whether its right.
1) For calculation of under insurance value, he has taken purchase value of machinery and applied inflation index to that value without considering the depreciation.
2) For calculation of loss, for the new spare part of machinery, he has deducted depriciation of 5% per year fom the year of puchase for the entire machinery.
3) For calculation of under insurance for 5 machcineries he has taken total value of all 25 machineries in factory and discounted total under insurance value of machinery on the loss of 5 machineries.
please advise on the correcttness of this damage assessment.
CAclubindia
