What is the procedure of efficient insurance valuation? Who takes part in the evaluation process, covered risks analysis and what advantages does engagement of independent experts have?
Sustainable development and efficiency of economic relations depend directly on the insurance industry reformation. Even though the Ukrainian insurance market is undercapitalized and falls behind in contrast to global trends, it is slowly but surely overcoming stagnation.
A considerable portion of the insurance process involves insurance valuation. This process can include several stages:
- valuation before accepting the risk for insurance coverage;
- valuation during the contract validity period due to the changes in the property’s insured value or extent of the risk;
- assessment of losses resulting from an insured event, establishing the causes of damage and finding ways to prevent potential expenses in the long run.
Who performs insurance valuation?
The purchase and sale item in the insurance market is the insurance service (insurance coverage) provided by professional insurance appraisers, surveyors, and claim adjusters. Let's see what each of them does.
Based on the name itself, the surveyor performs insurance valuation i.e. the survey prior to insurance process, inspects the property, makes analysis of the processes and causes, offers professional advice on risk prevention and possible consequences.
Surveyor’s report on performed valuation then goes straight to the insurer. Based on it, the insurer decides whether or not these risks have to be covered by insurance, and determines insurance tariffs. Investigation into the circumstances surrounding the insured events and estimation of damages may sometimes fall within surveyor's competence.
Surveyor’s key qualities include competence and independence. His task is to make accurate and unbiased assessment. An independent surveyor ensures that the recorded information correspond with reality. Unlike the insurer or the insurant, an independent expert doesn’t have any material interest in the outcome.
Vasyl Martynenko, Manager of Property Monetary Valuation Projects, employee at AIM throws some light on how this is done in real-world terms:
"For insurance company, it is vital to keep the risks borne in the course of insurance contract performance to a minimum. Surveyor tackles this task in a quality and timely manner.
For the company or plant, it also makes sense to hire the surveyor. When it comes to insurance payments, it is hard to avoid the back-and-forth i.e. how to qualify an event, whether or not it is insured event.
If you have no independent expert to clarify the situation, this issue can remain unresolved for quite some time. So, it is always a good idea to seek independent expert’s professional help."
These experts deal with protection of interests in disputable matters. Adjusters identify the causes, origin and size of the damage. Based on this, a claim report is prepared. Adjuster’s key task is to estimate the extent of the damage.
In Ukraine, the engagement of independent experts is becoming increasingly popular, whereas in the Western world it is already a common practice.
What are the advantages of hiring independent experts?
- carries out a comprehensive procedure;
- uses advanced evaluation methods;
- has bigger experience as compared to the members of the staff;
- ensures accuracy of task completion;
- completes work within a specified deadline;
- makes accurate and unbiased assessment;
- makes conclusions which correspond with reality.
By engaging an independent expert, you save time and money, get the work done in quality manner and avoid the lawsuits initiated by the party concerned.
To make sure that the independent expert evaluation is effective, contact AIM to get a free consultation.
The range of our services today includes:
- investigation of insured events;
- examination of the property insurance contract and establishing the fact of the insured event;
- inspection of the damaged/destroyed property, identifying the nature and extent of damage;
- investigation into the circumstances surrounding insured event, analysis of its causes, provision of recommendations on how to avoid it in the future;
- collection of necessary materials and evidence;
- estimation of the damage and insurance compensation for various property;
- determination of liability of the third parties, recommendations on enforcement of subrogation right/right of relief.
More details: https://aimarketing.info/services/technical-audit