Treatment of an Insurance Claim

We have carried out some Capital works on a property we own and are going to be receiving money towards the works from our insurance company. We would like to use the insurance monies to offset the capital expenditure, does anyone have any thoughts on how this should be accounted for?
  • Insurance receipts tend to be accounted as revenue (as you haven't disposed of an interest in an asset).
  • I would pay the receipt from the claim into the Insurance Revenue Account.

    Action a contribution from the Insurance Revenue Account to the Insurance Claims Reserve.

    Debit the Insurance Claims Reserve and make a contribution to the Council's fund.

    Finally, make a direct revenue contribution from the Council fund to Capital.

    I think that covers all the requirements.