Equipment Appraisal Blog | Understanding Machinery Appraisals

Need an Insurance Loss Settled? An Equipment Appraisal Can Help.

Posted by Equipment Appraisal Services on Mon, Jan 25, 2021 @ 08:00 AM

Machinery and Equipment Appraisal Insurance Loss Settlement

 

Did you know that over one-third of businesses that go through a disaster or property loss never open their doors again? This is primarily due to insufficient insurance or the inability to prove the value of equipment and other assets lost in the event. How do you protect your business against this kind of unexpected problem? An accredited equipment appraisal with a signed certification can go a long way towards ensuring you have adequate insurance to protect against a loss and to support equipment values during an insurance loss settlement.

Involved in an Insurance Loss Claim for Machinery & Equipment? Accredited Appraisals Will Assist in the Process.

Determining Insurance Coverage

When you are buying business insurance, you want to make sure all your assets, including machinery & equipment, are being covered for their current market or replacement cost value. Many people rely on tax return depreciation as a quick guide to appraising it, but the actual value may be much different than what standard accounting depreciation allows.

If the machinery & equipment is overvalued, you may be paying too much for premiums and will not recover the full amount you have estimated during a loss claim. If the assets are undervalued, the insurance company may have concerns that you did not pay for sufficient coverage and not be willing to pay you a fair value for casualty claims. An accredited machinery & equipment appraisal can go a long way to providing proof of value for your assets and assist in determining how much coverage you need.

Dealing with a Loss

When your business suffers an actual casualty loss, during this stressful time, you will want to reach a fair settlement as quickly as possible, to avoid business interruption. Can you prove what your equipment was actually worth? Having support documentation completed by an accredited machinery & equipment appraiser with signed certification helps to prove the real market value and can be utilized in an insurance settlement. The valuation is an objective, unbiased, defendable report that you can present to the insurance company during the claim process.

Even if you have not had a report completed before the loss, appraisers can retrospectively value the machinery & equipment as of the casualty loss date. An accredited equipment appraiser will sign a certification attesting to the value as of the prior loss date. They have the experience and expertise to research the market and make the appropriate adjustments to reflect market value as of the effective date. Make sure the firm employs accredited valuation experts who are members of the American Society of Appraisers (ASA). This ensures they follow the protocols of providing objective, supportable reports that will hold up in any settlement negotiation.

Tags: Insurance Loss, machinery & equipment appraisal, appraisal, equipment valuation, Insurance Claim Asset Appraisal

Material Handling Equipment Valuations - Why Many Companies Need Them

Posted by Equipment Appraisal Services on Mon, Jan 11, 2021 @ 08:00 AM

Material Handling Appraisal

 

Virtually every business in the world that manufactures, transports, warehouses or otherwise supports any tangible product needs some type of material handling equipment to manage their inventory. It is important to understand the value of these types of assets when considering any financial transaction within your business so you can be sure to get the most benefit from the utilization and strength of these long lived machines.

What Types of Machinery are Considered Material Handing?

The first thing that comes to mind when discussing material handling for most businesses is forklift trucks. Forklifts are the most common type of equipment that falls into the material handling category, however, there is a considerably diverse amount of lift equipment that belongs as well.

Forklift Trucks

Forklift trucks alone have an immensely broad range of sizes, builds, and other specifications which can be overwhelming and fall into different categories of material handling. From the smallest manual pallet jacks to the largest type of container handler, there are hundreds of makes and models in between. From lifting a 500 lb. box to a 90,000 lb. shipping container, these types of assets are critical to effectively moving product from place to place.

The most common types of forklift trucks you see generally range from 3000-15,000 lb. capacities and are used in and around warehouses, loading docks and shipping centers. The lifts can be powered by rechargeable battery, propane gas, or diesel. Several domestic and international manufacturers compete in the industry, many with solid reputations for quality, producing long life durable machinery. Even if you have a 20+-year-old forklift, as long as it has been well maintained throughout its life, you can expect it to hold value over time.

What are Other Types of Material Handling Equipment?

The answer to this question may be a little subjective depending upon the industry or business you work in. I would consider these types of equipment to be included:

  • Order Pickers
  • Narrow Aisle Reach Trucks
  • Automated Pick & Place Retrieval Conveying Systems
  • Bulk Processing Equipment (Including Conveyors, Hoppers, Elevator Lifts & Augurs)
  • Pallet Racking, Shelving & Related Storage Equipment
  • Aerial Boom Lifts
  • Certain Types of Cranes

Similar to forklift trucks, these assets are typically long lived and hold their value well over time.

In summary, always consider material handling machinery & equipment as part of your asset listing when you need an updated appraisal. When deciding to engage a professional for this task, the best choice is an accredited ASA appraiser.

Tags: valuation, forklift appraisal, certified appraisal, material handling equipment