Valued Policy
Policy that pays a specified sum not related in any way to the extent of the loss. The term applies to a life insurance policy rather than to a contract of indemnity because the former does not purport to restore an insured (or beneficiary) to the same financial position after a loss as prior to the loss. The sum of money that a life insurance policy pays as a death benefit is a definite amount that may or may not have any relation to the quantitative value of the death. Thus, the life insurance policy is deemed to be a valued policy.
Popular Insurance Terms
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1% of the loan amount paid to the lender for making a loan. ...
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Average earned monthly income of the insured wage earner after regular earned income has been interrupted or terminated because of illness, sickness, or accident. This income amount is ...
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