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Machinery Sum Insured Calculator
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Chart
Show formula & working
Reinstatement value = new replacement cost + freight + duty + erection + taxes not recovered
Indemnity value = reinstatement value × value left after depreciation (straight line: 1 − (1 − floor) × age ÷ life; WDV: (1 − rate)age; never below the floor)
Details
How this works
Machinery cover can pay for a new replacement (reinstatement) or the depreciated value (indemnity). The sum insured must match the basis you choose, or the average clause will cut claims.
Book value is not the right sum insured — prices rise, and accounting depreciation rarely matches real wear.
Frequently asked questions
Reinstatement or indemnity?
Reinstatement pays what it costs to put a new machine in place, so you are not out of pocket; it costs more in premium.
Should I use book value?
No. Use the current cost of a new equivalent machine.
What WDV rate should I use?
A rate that reflects real wear. 13.91% is just an example; your surveyor can advise.
Reviewing your cover?
Talk to Rytvae about how much cover you need and what your policy wording really pays.