Today’s risk managers consider many factors when updating insurable values for equipment and personal property, including:

• Acquisition or divestiture of facilities and associated equipment
• Rationalizations, transfer of production lines, changes in occupancies, plant additions, etc.
• Turnover of capital assets, especially retirements
• Average asset lives in high-tech and healthcare environments
• Use of correct cost trend factors to adjust personal property values

Cost trends are indicators of average change, however - and there is no “average” assemblage of equipment. Trends vary from industry to industry and should not be used beyond seven to ten years; thus, re-establishing personal property insurance replacement costs on a five- to seven-year cycle serves as the basis of good underwriting practice.

Duff & Phelps employs a global team of experienced equipment valuation specialists. Our professionals use various approaches for personal property insurance appraisals depending on the occupancy and needs of our clients, including detailed asset listing, full physical inventory and appraisal, and on-site verification of specific assets.