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physical verification of the assets in place has been completed, yes perhaps even inter -related with a "trend and bend" work effort. No, a sloppy trend and bend job will not provide adequate proof j of loss. Yes, the information must be kept up to date. The asset listings and value information S must be kept up to date either within the fixed asset accounting system or as a separate aside record, j incorporating inflation / deflation adjustments, changes in depreciation if appropriate for the policy /contract form, and of course additions or deletions. Critical property and casualty insurance thoughts: • One may rather deal with the IRS than fight an insurance battle. • Understand the insurance policy ("contract") coinsurance clause where assured shares in the settlement to the extent (say 80% usual) of the insurance that should have been carried. • The fixed asset accounting record is not adequate proof of loss. I repeat, the fixed asset accounting record is not adequate proof of loss. • Understand the difference between a Replacement Cast policy and an Actual .Cash Value policy • Replacement Cost policies are"repair or replace" often up to Actual Cash Value (a litigious issue, also considering the issues of Market Value, depreciation or betterment). • Further, if Replacement Cost, usually the insurance policy (contract) states that Actual Cash Value will be. paid until or if the covered assets are replaced (language varies per differing forms), then if replaced the full Replacement Cost is paid. • .Actual Cash Value generally considers the current cost new for the same functional utility, less physical depreciation / deterioration. But in some instances ACV is considered to mean the cost of replacing the asset at Market Value (another litigious issue), • Being unprepared to prove one's loss may prove to be extremely costly, particularly if one, had not gone through the exercise and cost of perpetually being prepared in advance. • The insurance company will not pay for betterments, meaning if you have an old Model A asset and now a Model B is only available you will not receive the settlement for a Model B loss. Check insurance contracts in this regard concerning betterments. • The insurance company may well not pay for engineering or intangible assets relating to specific tangible assets. Check the policy and/or discuss this matter with the broker. • Understand what the insurance policy says, One can under -insure as well as over -insure. A personal note. Are you prepared for a loss at your home? Do you have the proof of value and listing of the assets, or at least photos or a movie / video of the residence and the contents? Is this information somewhere else other than in your residence? All are encouraged to get prepared for an unfortunate insured event. But imagine in a loss situation how much less of a fair settlement you would receive if such data is not available. Then project this thought into your business situation. Not good? You are encouraged to cure this situation in all regards. Alex Ruden, ASA (M&TS & ARM), CG/GA, Business Valuer, is the fourth generation of his family in the appraisal / valuation business. His great grandfather was a Public Adjuster being a -113-