Valuation is a financial assessment of the worth of an item. In the context of insurance, valuation refers to giving a dollar figure for assets to be insured. This way both the insured and the insurer know how much money the insurer will give to the insured in the event of a covered loss for the asset.
Your policy values your equipment by Replacement Cost which means the cost to repair, rebuild, or replace the lost or damaged property with other property with like kind and quality.
In the event of a claim where repair is required, the insurance carrier will not pay for the damage until the property is actually repaired or replaced.
If you wish to settle with Actual Cash Value instead of Replacement Cost, you will receive a check instead of reimbursement for replacement property, less 20% of the full replacement cost (to receive the remaining amount when you provide proof of purchase), you’ll have the opportunity to make that decision during your claim proceeding.
How to value equipment
Look at the current market rate of the item you own or rent; same make and model. The claims adjuster may correct your declared replacement cost.
For example: You purchased a camera in 2018 for $4K. Today that same camera (make and model) can be purchased on eBay for $2,500. The current replacement cost value of the camera is $2,500.
Insurance is meant to make you whole again, not increase your property worth.
If your item is two years old, you should look at the used value of the same make a model. If you just purchased your item within the last three months, you can look at the new value of the same make and model.