ROUX AFRIQUEGROUP
ROUX AFRIQUE EVS · AFRICA & THE MIDDLE EAST
PROTECT · VALUE · SECURE
The technical foundation that safeguards your insurance programme and strengthens the credibility of your decisions.
As at a defined valuation date and in a specified currency, Roux Afrique EVS determines and structures the insurable values of buildings, civil works, installations, machinery, equipment and technical assets.
The assignment transforms physical, technical and economic data into a documented, traceable and updateable Statement of Values, ready for use by the company and its brokers, insurers and reinsurers.
SUBSTANTIATING THE INSURED BASIS
Historical acquisition cost, net book value or the mechanical application of an index does not necessarily represent the current cost of rebuilding or replacing an asset.
Inflation, exchange rates, international freight, non-recoverable duties and taxes, installation costs, engineering, testing, commissioning, access constraints and technological developments can materially alter the capital required to reinstate a site.
The valuation provides a technical basis for decision-making. It does not guarantee the amount of any indemnity or a reduction in premium, both of which remain subject to the definitions, clauses and conditions of the insurance contract.
VALUATION DISCIPLINE
An identifiable description, location and insurance category.
Reinstatement Value New, Depreciated Value, Fair Market Value or Value in Use.
Every value must be linked to a defined valuation date.
The currency, exchange rates and their effective date are explicitly stated.
Each result is linked to documented data, calculation parameters and limitations.
BASES OF VALUE
For buildings and civil works, this is the estimated cost of rebuilding them as new as at the valuation date.
For machinery, equipment and technical installations, it is the cost of replacement with a modern asset providing equivalent utility, capacity and functional performance.
Depending on the contractual scope, it may include design studies, transport, freight, non-recoverable duties, installation, foundations, erection, testing and commissioning.
This is the Reinstatement Value New less documented depreciation, taking into account factors such as age, condition, maintenance and remaining useful life.
Adjustments for functional, technical or economic obsolescence are applied only where justified by the basis of value adopted and the instructions governing the assignment.
The insurance value actually declared may be stated on either a Reinstatement Value New or a Depreciated Value basis. The applicable basis remains determined by the definitions and conditions of the policy.
Fair Market Value estimates the price at which an asset could be exchanged, as at the valuation date, between knowledgeable, independent parties acting without compulsion, in accordance with the definition expressly adopted in the engagement.
It is an asset-valuation or transactional basis of value. It is not a substitute for the reinstatement value used for Property Damage insurance.
Value in Use reflects the asset's entity-specific economic value in its current use, based on assumptions specific to the business and the economic benefits expected from the asset.
It is distinct from market value, financial Fair Value and insurance value.
These four bases are never combined. The purpose, definition, valuation date, currency and specific assumptions applicable to each are formally established.
SCOPE
Depending on the instructions governing the assignment, the valuation may cover:
Land, inventories, merchandise, intangible assets, vehicles, works of art, third-party property and other specific asset classes are included only where a specific scope and basis of value have been expressly defined.
An asset-allocation matrix distinguishes buildings, general installations, plant and equipment in order to prevent omissions and double counting.
STATEMENT OF VALUES
The Statement of Values — SOV structures insurable values by:
For a multi-site portfolio, values are produced individually for each location and then consolidated using a consistent classification structure.
The principal SOV presents the Reinstatement Value New and the Depreciated Value — Insurance Value. Fair Market Value and Value in Use are presented in separate schedules where included in the engagement.
METHODOLOGY
Define the purpose, entities, sites, valuation date, currency, bases of value, asset categories, landlord and tenant responsibilities, and all inclusions and exclusions.
Review the policies, existing SOVs, fixed-asset registers, drawings, invoices, contracts, technical records, equipment lists, capital expenditure and other available sources.
Accounting data supports reconciliation; it does not automatically replace insurance value.
Identify and characterise the assets: location, dimensions, construction, function, manufacturer, model, capacity, age, condition, maintenance and installation environment.
The depth of survey work — exhaustive, targeted or sample-based — is defined in the engagement. A comprehensive physical inventory and the creation of an Asset Register remain a separate assignment.
Organise assets by entity, site, area and insurance category. Identify missing assets, duplicates, transfers, recent investments, disposals and allocation inconsistencies.
Assess local and imported costs, modern equivalent solutions, freight, non-recoverable duties, installation, engineering, testing and commissioning, within the agreed scope.
Exchange-rate effects, location, site accessibility and market conditions are addressed separately and linked to the valuation date.
Determine Depreciated Value on the basis of documented assumptions applied either asset by asset or to homogeneous asset groups where that approach is justified.
Fair Market Value and Value in Use are determined in accordance with their respective methodologies and assumptions where included in the engagement.
Perform reconciliations, consistency checks, variance analyses, unit-cost checks, double-counting reviews and validation of aggregations.
Material assumptions, missing data and limitations are subject to expert review before issue.
Issue a draft version, collect documented comments, resolve variances and then produce the final report and SOV.
An updating protocol sets out responsibilities, trigger events, index sources and updating rules.
QA/QC
The QA/QC process covers, in particular:
Every value must be linked to an asset, a basis of value, a date, a currency, a source and an assumption.
INVENTYS® · VRA3D
Technology strengthens the structure, traceability and technical record of the assignment.
Inventys® structures the physical, technical, economic and insurance data used throughout the assignment.
Where appropriate, VRA3D supplements the surveys with visual and spatial documentation of buildings, installations and equipment.
Technology enhances expertise; it does not replace professional judgement, controls or final validation.
DELIVERABLES
Depending on the engagement:
DECISIVE MOMENTS
Updating should not be based solely on a fixed timetable. It should also be triggered by any material change in assets, costs, currencies or the insured perimeter.
CRITICAL ENVIRONMENTS
Sectors served:
Our experts operate across Africa, the Maghreb and the Middle East, adapting cost data and models to the technical, logistical and monetary realities of each location.
CLEAR RESPONSIBILITIES
Determines the values of tangible property required for the SOV.
Separately determines Business Interruption values and exposures.
Comprehensively identifies assets and organises their physical, technical and accounting reconciliation.
Analyses hazards, protection measures, vulnerabilities and EML, PML or MFL scenarios.
Reviews programme architecture, Risk Financing and insurance Due Diligence matters.
Establishes and quantifies post-loss damage and structures the claim.
SMP, SME, EML, PML or MFL scenarios and contractual limits of indemnity are not bases of value. They fall within the remit of the Risk Survey or insurance programme structuring.
STANDARDS
The engagement letter specifies the contractual definitions, bases of value, methodologies, professional standards and applicable local requirements.
A generic reference to a standard is never a substitute for analysing the contract, the scope and the valuation's actual purpose.
FREQUENTLY ASKED QUESTIONS
Accounting values are governed by recognition, depreciation and financial-reporting rules. They do not necessarily reflect the current cost of rebuilding or replacing assets.
Reinstatement Value New estimates the current cost of reconstruction or replacement. Depreciated Value applies a documented adjustment that takes account, in particular, of age, condition, maintenance and remaining useful life.
No. Depending on the policy, the insured basis may be Reinstatement Value New or Depreciated Value. The contract determines the basis to be declared and the method of indemnification.
Insurance value addresses the reconstruction or replacement requirement defined by the policy. Fair Market Value relates to a market transaction. Value in Use reflects the entity-specific economic utility of the asset.
It presents assets and their values by entity, site, area and category, together with the date, currency, bases of value, sources, assumptions and levels of consolidation adopted.
No. The survey work required for the valuation is defined in the engagement letter. The creation of a comprehensive Asset Register falls within the separate ‘Physical Inventory & Asset Register’ assignment.
Values should be reviewed at renewal and following any material change: acquisition, disposal, extension, replacement or a significant movement in costs, inflation or exchange rates.
No. Indemnification depends on the policy, cover, exclusions, deductibles, limits, circumstances of the loss and supporting evidence provided. The valuation supplies a documented basis for substantiating declared asset values.
SUBSTANTIATE VALUE
Share your sites, current SOV, principal asset categories and the decision you need to make. Roux Afrique EVS will structure the scope, bases of value, methodology and deliverables accordingly.
Speak with Roux Afrique EVS