Page 277 - Fire Insurance Ebook IC 57

The Insurance Times

has a ready market and is replaceable, the loss is
assessed on the basis of cost of replacement from the
supplier or the wholesaler.

If the stock is damaged but can be reconditioned for
sale, then the basis of settlement will be the cost of
reconditioning plus any reduction in its sale price because
of the reconditioned nature of the goods.

If the reconditioning is not possible or the insured is
willing to retain the salvage, then the loss is assessed
on the basis of sound value, i.e, replacement cost
from the wholesaler or manufacturer, and the amount
of damage suffered by goods.

e. Stock in process - Examination of the salvage and the
premises may not reveal much information about the
stock in process. The quantities, therefore will have to
be determined by a careful study of the production flow
charts, process accounts etc.

The results are then cross checked with the process
accounts of the preceding as well as subsequent

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