VETTING OF LARGE MARINE CLAIMS AND THEIR ADJUSTMENT(BEFORE SETTLEMENT)
To determine the actual insured value of losses particularly for a claim on depreciated items with various value on the invoice or where replacement of parts are involved, accurate computation of insured value for such losses or claims is not always easy. There is however formulae for adjusting such costs without resorting to the use of exchange rate application. Most insured often calculate their claims on the basis of acceptable Exchange Rate. This is not always right because it can't give one the correct insured value of the loss under claim. And most times, unknown to the underwriters, such calculation greatly favors the claimant because it only gives you the commercial value of loss and not the insured value of loss.
Hence, where a fairly huge claim is involved, we may be approached to vet the adjustment before sending out the SDV to the claimant for signature. This is to ensure that the actual insured value of the loss for settlement is the one reflected on the Subrogation Discharge Voucher (SDV) for insured's signature.
Then we usually take such opportunity to provide brief comment on areas needing further attention (if any) before settlement and also advise the Underwriter on the chances of Recovery.