A policy valuation method where you and your insurer agree on your yacht's value when the policy begins. In a total loss, you receive this agreed amount (minus deductible), regardless of market fluctuations.
How It Works
When you purchase an agreed value policy, the insurer evaluates your yacht through surveys, comparables, and purchase records to determine its fair market value. Once both parties agree on a specific dollar amount (e.g., $500,000), this becomes the maximum the insurer will pay in a total loss claim.
Example
You buy a 45-foot yacht for $450,000. After a marine survey, you and your insurer agree on a value of $450,000. Three years later, a hurricane sinks the yacht. You receive $450,000 (minus your deductible), even if similar yachts now sell for only $350,000 due to market depreciation.
You receive this agreed amount regardless of market fluctuations.
For a serious yacht, certainty is the point: the figure you agreed on is the figure you are owed.
Key Benefits
- Predictability: You know exactly what you'll receive
- No depreciation: Market changes don't reduce your payout
- Lender requirement: Most marine lenders require agreed value