Methods Of Settlement

There are basically three types of settlement possible depending on the type of policy or the Insurer’s decision:

  • Indemnity:
    • cash payment/replacement of item that places the insured in a similar position that existed immediately prior to the loss (depreciation applicable).

  • Repair:
    • insurers may elect to repair or reimburse for cost of repair.

  • Reinstatement:
    • (new for old): cost of rebuilding/replacement without deduction for deprecation.


Obligations Of The Insured

  • Take reasonable measures to reduce the effects of a loss


  • Report the occurrence immediately to your Broker/Insurer. It is not necessary to await the full details of the full details of the incident before making a report.


  • Co-operate with the Broker/Insurer or their appointment representative by answering all questions regarding the facts and circumstances of the loss.


  • Document precisely the cause and extent of the loss, since in some instances the cause is not readily identifiable, and in some cases it may be necessary to prove that the cause of loss falls within the scope of your policy coverage. If there is a camera on hand take a picture of the damage since it can assist in the loss assessment.