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Insurance Glossary

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Valid Contract
A contract which can be enforced in a court of law.

Valuation Clause
A clause which appears in the Institute Time Clauses and other hull clauses which provides that the insured value is to be taken as the repaired value for constructive total loss purposes and nothing in respect of break up value is to be taken into account.

The worth of the property to be insured or of that which has been lost or damaged.

Valued policy
Contracts of Insurance where the sum insured in respect of the insured property is deemed to be the actual value of the property throughout the currency of insurance. Claims in respect of total loss are settled without any adjustment which may otherwise arise on such considerations as adequacy of the sum insured, market value, etc.

Marine Insurance Policies both for Cargo and Hull are all "Valued Policies". As regards policies like Fire and Burglary Policies this facility is extended in respect of valuables, paintings, pictures, curios, antiques and other works of art.

Variable Expenses
Cost or expenses which vary in proportion to the quantum of production or the volume of turnover. Variable expenses are eliminated while computing the gross profit of a business for the purpose of fixing the sum insured under a business interruption or the consequential loss policy.

Variable Quota Share Treaty
In a Quota Share Treaty there may be retention with maximum say 20%. This would mean that on certain risks retention can be lower than this percentage. This is termed as variable quota share. There will be corresponding variation with regard to maximum reinsurance in respect those risks.

Vehicles Laid Up
Refers to a comprehensively insured motor vehicle being laid up in garage and not in use. Subject to a notice from the insured in advance of the period during which the vehicle will be laid up, insurer will restrict the cover during the laid up period to Fire, Burglary and Theft Risks only. The insured consequently will get either of the following benefits

1. A portion of the premium already collected by the insurer will be given to the credit of the insured at the time of renewal of the policy or

2. The existing policy will be extended by a period equivalent to the laid up period by charging an extra premium which will represent the premium for the restricted cover during the laid up period.

Vehicles subject to Hypothecation Agreement
It is not permissible to issue policies in the joint names of Pledge and Registered Owner of the vehicle. Policies must be issued in the name of Registered Owner of the vehicle and the Pledges interest protected by the use appropriate Endorsement.

Vehicles subject to Lease Agreement
It is not permissible to issue policies in the joint names of Lessee and Lessor. Policies must be issued in the name of Lessee and the Lessors interest protected by the use of appropriate Endorsement.

Veterinary Health Certificate
Certificate issued by a qualified Veterinarian on the health and value of the animal. This is obtained at the time of insurance so that healthy animals are only insured and for their real value.
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