Marine, Shipbuilding & Boat Manufacturing worked example

Vessel Warranty Reserve Cost with vessels under warranty of 110 vessels: a worked example

What does the result look like when vessels under warranty reaches 110 vessels? The full calculation is worked below with real intermediate numbers. Use it when pricing new vessels or setting financial reserves to ensure warranty obligations are adequately funded based on historical claim experience.

The inputs for this scenario

  • Vessels under warranty: 110 vessels (raised for this scenario; the documented default is 45)
  • Average claims per vessel per year: 2.5 claims / vessel / yr (unchanged)
  • Average cost per warranty claim: 650 $ / claim (unchanged)
  • Fixed annual warranty admin cost: 35,000 $ / yr (unchanged)

Working through the calculation

  • Applying the documented formula (Annual warranty claim cost = vessels under warranty x claims per vessel x cost per claim) to the inputs above produces each figure below.
  • At this operating point the engine returns 36,788 $ for total annual warranty reserve needed, the number this scenario is built around.
  • At this operating point the engine returns 334 $ / piece for warranty reserve per vessel per year.
  • At this operating point the engine returns 1,788 $ for annual warranty claim cost.
  • At this operating point the engine returns 35,000 $ for fixed warranty administration cost.

How this compares with the baseline

  • Against the tool's baseline example, where vessels under warranty sits at 45 vessels and the headline result is 35,731 $, this scenario comes in 2.96% above the baseline at 36,788 $.
  • A figure at this level is achievable when vessels under warranty is genuinely sustained, not just peaked for a shift. It assumes average claim rate and cost; a single catastrophic claim or a systemic defect across the fleet can blow past an average-based reserve.

Results at a glance

  • Total annual warranty reserve needed: 36,788 $ (headline result)
  • Warranty reserve per vessel per year: 334 $ / piece
  • Annual warranty claim cost: 1,788 $
  • Fixed warranty administration cost: 35,000 $

Run it with your numbers

  • Every input above is editable in the live Vessel Warranty Reserve Cost calculator, which recalculates instantly and can be shared with the inputs intact.

Last reviewed 2026-05-12.