PERSONAL INLAND MARINE · 6 MIN READ

Valuation and Loss Settlement on the PAF

The baseline Personal Articles Form settles a loss at the least of three figures: the scheduled amount for the item, the actual cost to repair it, or the cost to replace it with substantially identical property. The scheduled amount is therefore a per-item cap — if the market value has risen above the schedule, the insured eats the gap, which is why re-appraisal discipline matters. The mirror-image rule is friendlier: the PAF applies no coinsurance, so under-scheduling never triggers a proportional penalty on partial losses; recovery is simply capped at the scheduled amount. For fine art, antiques, and other unique items, an Agreed Value endorsement removes post-loss valuation disputes entirely — on a covered total loss the insurer pays the full scheduled amount without requiring proof of current market value. Collectibles have their own valuation convention: coins, stamps, and memorabilia are valued at retail replacement — what the insured would pay a reputable dealer for a comparable specimen — not the lower auction-hammer realization price. The pair-and-set clause handles matched items worth more together than apart: when one piece of a matched pair is destroyed, the insurer pays a fair proportion of the total set value reflecting the diminished worth of the survivor, typically well above a naive 50 percent split, and some forms let the insurer take the remainder and pay full set value. Settlement carries consequences. When the insurer pays full value, title to the salvage passes to the carrier, preventing the insured from keeping both the money and the damaged item. A paid total loss removes the item from the schedule with no automatic reinstatement — a replacement piece must be newly appraised and scheduled. The insurer holds subrogation rights against third-party wrongdoers, but the anti-subrogation rule bars it from suing its own insured for a covered loss the insured negligently caused.