How are losses valued under a Commercial Crime policy?

In the context of a Commercial Crime policy, the correct approach to valuing losses is essential for accurately determining the compensation an insured party would receive after a loss event. The first element, money, is valued at face value. This means that the cash component of any claim is straightforward—the insured is reimbursed for the exact amount of money that was lost.

For securities, the valuation is based on the loss discovery date. This date is significant because it marks the point in time when the loss is discovered and, consequently, when the value of the securities—whether they are bonds, stocks, or other financial instruments—can be accurately assessed. This method ensures that the insured receives compensation reflective of the market value at the time the loss was identified, as the values of securities can fluctuate significantly over time.

When it comes to property, using the cost to repair or replace is crucial. This means that the insured can claim the amount necessary to either fix the property to its previous condition or to acquire new property that serves the same function as the lost or damaged item. This restoration principle helps ensure that the insured is put back in the same financial position they were in prior to the loss, as opposed to receiving a lower value that might not cover the expense of