How to: Insure Fixed Assets

An insurance policy for a fixed asset is represented by an insurance card. You can assign one fixed asset to one insurance policy or multiple fixed assets to one insurance policy.

You assign a fixed asset to an insurance policy by posting to the insurance coverage ledger from the Insurance Journal window.

In addition, you can assign a fixed asset to an insurance policy and create coverage ledger entries when you post its acquisition cost. You do this by posting an acquisition cost from the fixed asset journal with the Insurance No. field filled in. The Automatic Insurance Posting check box in the Fixed Asset Setup window must be selected. For more information, see the "To post a fixed asset acquisition manually with the fixed asset G/L journal" section in How to: Acquire Fixed Assets.

If the Automatic Insurance Posting check box in the Fixed Asset Setup window is not selected, then posting acquisitions from the fixed asset journal will create lines in the Insurance Journal window, which you must then post manually.

Warning

If you do not select the Automatic Insurance Posting check box in the Fixed Asset Setup window, then your insurance journal should be based on a journal template without a number series. This is because the inserted document numbers from the fixed asset journal line will otherwise conflict with the number series of the insurance journal. For more information about journal templates and batches, see How to: Set Up General Fixed Assets Information.

After you have assigned a fixed asset to an insurance policy, the Insured check box is selected on the fixed asset card. When you sell the fixed asset, the check box is automatically deselected.

To create or modify an insurance card

An insurance policy for a fixed asset must be represented by an insurance card.

When you receive information about changes in the coverage amount, you must enter the new information in the Insurance Card window to ensure that you analyze insurance policy coverage correctly.

  1. Choose the Search for Page or Report icon, enter Insurance, and then choose the related link.
  2. Choose the New action to create a new card for an insurance policy. Choose a field to read a short description of the field or link to more information.
  3. Alternatively, select the insurance policy that you want to change, and then choose the Edit action.

To assign a fixed asset to an insurance policy by posting from the insurance journal

You assign a fixed asset to an insurance policy by posting to the insurance coverage ledger.

The following procedure explains how to create an insurance journal line manually. If the Automatic Insurance Posting check box is selected in the FA Setup window, then insurance journal lines are automatically created when you post acquisition costs. In that case, all you have to do is to post the journal.

  1. Choose the Search for Page or Report icon, enter Insurance Journals, and then choose the related link.
  2. Open the relevant journal, and fill in the journal lines as necessary.
  3. To assign multiple fixed assets to one insurance policy, create journal lines with the same value in the Insurance No. field and different values in the FA No. field.
  4. Choose the Post action.

    Note

    The entries from an insurance journal are only posted to the insurance coverage ledger.

To update the insurance value of a fixed asset

You can use the Index Insurance batch job to update the value of the fixed assets that are covered.

  1. Choose the Search for Page or Report icon, enter Index Insurance, and then choose the related link.
  2. Fill in the fields as necessary.

    Note

    In the Index Figure field, you enter a decrease of 5%, for example, as 95, whereas you enter an increase of 2% as 102.

  3. Choose the OK button.

    The batch job calculates the new amount as a percentage of the total value insured, as stated in the Insurance Statistics window, and then creates a line in the insurance journal.

  4. Choose the Search for Page or Report icon, enter Insurance Journals, and then choose the related link.
  5. Open the relevant insurance journal, review the created values, and then post them to the insurance coverage ledger.

To monitor insurance coverage

Financials provides dedicated reports and statistics windows for use in analyzing insurance policies and whether your fixed assets are over- or under-insured.

Overview of Insurance Policies

To get an overview of your insurance policies, preview or print the Insurance - List report. The report shows all the policies and the most important fields from the insurance cards.

Insurance Coverage

To see which insurance policies cover each asset and by which amount, you can preview or print the Insurance - Tot. Value Insured report.

Over/Under Coverage

You can check if fixed assets are over- or under-insured in the following ways:

  • The Insurance Statistics window. A positive amount in the Over/Under Insured field means that the fixed asset is over-insured. A negative amount means that it is underinsured.
  • The Fixed Asset Statistics window. Choose the Total Value Insured field to view the Ins. Coverage Ledger Entries window.
  • The Over/Under Coverage report.
  • The Insurance Analysis report.

Uninsured Fixed Assets

To check if you have forgotten to assign a fixed asset to an insurance policy, you can print or preview the Insurance - Uninsured FAs report. This report displays fixed assets for which amounts have not been posted to the insurance coverage ledger.

To view insurance coverage ledger entries

You can view the entries that you have made in the insurance coverage ledger.

  1. Choose the Search for Page or Report icon, enter Insurance, and then choose the related link.
  2. Select the relevant insurance policy, and then choose the Coverage Ledger Entries action.

To view the total insurance value of fixed assets

A dedicated matrix window shows the insurance values that are registered for each insurance policy for each fixed asset as a result of insurance-related amounts that you have posted.

  1. Choose the Search for Page or Report icon, enter Insurance, and then choose the related link.
  2. Select the relevant insurance policy, and then choose the Total Value Insures per FA action.
  3. Fill in the fields as necessary.
  4. Choose the Show Matrix action.
  5. To see the underlying insurance coverage ledger entries, choose a value in the matrix.

To correct insurance coverage entries

If a fixed asset has been attached to the wrong insurance policy, you can correct it by creating two reclassification entries from the insurance journal.

  1. Choose the Search for Page or Report icon, enter Insurance Journals, and then choose the related link.
  2. Create one journal line for the fixed asset and the correct insurance policy where the value in the Amount field is positive.
  3. Create another journal line for the fixed asset and the incorrect insurance policy where the value in the Amount field is negative.
  4. Choose the Post action.

The fixed asset will be detached from the incorrect insurance policy, on the second line, and attached to the correct insurance policy, on the first line.

See Also

Fixed Assets
Setting Up Fixed Assets
Finance
Working with Financials