My experience dealing with (Canadian) insurance companies, from the point of a bike shop writing quotes for replacement of damaged or stolen bikes, is that they generally ask what an equivalent modern bike would cost. If you have a preferred LBS who knows your bike and can say it is equivalent to, say, a modern Surly LHT, then the insurance company might cut a cheque for the MSRP of a new.
Things in Canada might be different from the USA - first, we don't have many Schwinns here, so I might be out to lunch re. it's equivalent replacement, and also medical bills are generally covered by provincial health care systems, so Insurance Cos aren't on the hook for 100s of 1000s of $s for a broken pinky toe, so they might look at bike replacements from a different perspective.