How do you handle insurance claim payments?

millerswife · February 2022

We have had a few different insurance claim payments. How do you handle these scenarios within Quicken? Our *previous* bookkeeper labeled them as "other income".

roof replacement ($4k)
totaled vehicle (check given, used to purchase a new one)
totaled vehicle, but we bought the salvaged title
vandalized vehicle (check given, used towards repairs)

I assume I can transfer the ones where a new vehicle was purchased, but we also have instances where the vehicle was totaled and we couldn't find a replacement right away, or where we received $5000 and found a new one for $4000.

NotACPA · February 2022

How did you record the amounts that you paid for those repairs?

I'd record the insurance reimbursements using those same categories.

Frankx · February 2022

Hi @millerswife,

Typically, when you receive a payment from an insurance company related to property, you have had a loss of some type. The payment is "reimbursement" for that loss. So, The concept is that you should "match" - to the extent possible - the insurance reimbursement with the costs incurred to fix or replace the property.

The reimbursements for the automobile related losses noted above above would usually be posted as follows:

totaled vehicle (check given, used to purchase a new one) - post to the automobile "asset" account

totaled vehicle, but we bought the salvaged title - post to the automobile "asset" account

vandalized vehicle (check given, used towards repairs) - post to same account/category that you used when you posted the repairs payment

The "roof replacement" should be posted to the account/category that you used when you recorded the payment for fixing the roof (or to have the roof replaced).

Let me know if you have any followups.

Frankx

How do you handle insurance claim payments?

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