Which value is not considered when determining the amount of a loss settlement?

The determination of a loss settlement primarily focuses on the actual value of the property affected by the loss, taking into account the initial investment, the current market conditions, and the necessary expenses to replace it. In this context, the future investment value of the property is not a consideration when settling a loss. This is because loss settlements are based on the present value or replacement cost of the property, rather than hypothetical future valuations or returns.

The other factors considered include the replacement cost of the lost or damaged property, which reflects what it would cost to replace the item in its current state, accounting for depreciation. The financial interest of the insured takes into account how much the insured has invested in the property, ensuring that the settlement reflects their actual stake. Similarly, the amount of insurance purchased plays a crucial role, as it defines the maximum liability that the insurer might owe in a settlement. These elements are grounded in assessing tangible, existing values rather than speculative future potential.