FAIR Appraisal Guide
Insurance Value vs Fair Market Value: Clear Guide
Insurance value and fair market value are distinct valuation contexts. Selecting the wrong one is the fastest way to create filing or underwriting friction.
- Match the appraiser to the item category.
- Confirm the report purpose before pricing.
- Compare fee disclosure before outreach.
The intended audience and decision use are different, so report framing should also differ.
- Insurance context focuses on coverage adequacy and scheduling.
- Fair market value context focuses on tax/legal defensibility.
- Evidence may overlap, but assumptions and conclusions differ.
Pick valuation basis by decision use first, then define report requirements.
- Working with carrier underwriters: start insurance-first.
- Working with CPA/counsel: start tax-first.
- Need both: plan two outputs and shared evidence package.
Use a shared intake file but keep final deliverables purpose-specific.
- Single intake, two report tracks.
- Explicit purpose statements in each final document.
- Advisor and carrier review before close-out.
- Can one valuation basis satisfy all stakeholders? Rarely. Most stakeholders expect purpose-specific framing and language.
- What should be identical across both reports? Item identity, condition evidence, and factual background can remain consistent across both reports.
- What should differ across both reports? Purpose statement, valuation framing, and conclusion context should differ by intended use.