AGREED VALUE Meaning and
Definition
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Agreed value is a term primarily used in insurance and finance that refers to the predetermined amount of money agreed upon by the parties involved as the value of an asset or property. This agreed value is typically reached through negotiation and mutual consent, where both parties agree to a specified amount that will be used as the basis for coverage or financial transactions. Agreed value serves as a reference point or benchmark for determining various aspects related to insurance policies, loans, investments, or legal agreements.
In the insurance industry, agreed value is commonly used for insuring high-value assets such as rare collectibles, antique items, art pieces, or specialty vehicles. Instead of the usual market value or replacement cost, the insurer and policyholder agree upfront on a specific amount that will be paid out in the event of a covered loss. This ensures that the policyholder will receive the agreed-upon amount, regardless of any fluctuation in the asset's actual market value.
Agreed value is also prevalent in financial transactions such as loans or investments. In these cases, the agreed value determines the principal amount or the value of the asset against which funds are released or interest is calculated. It provides clarity and uniformity for both parties involved, ensuring that there is a common understanding of the value used as the basis for the transaction. Agreed value can also be utilized in legal agreements or contracts where the value of a particular asset or property is a crucial factor.
Common Misspellings for AGREED VALUE
- zgreed value
- sgreed value
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- qgreed value
- afreed value
- avreed value
- abreed value
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- ayreed value
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- agdeed value
- agfeed value
- agteed value
- ag5eed value
- ag4eed value
- agrwed value
- agrsed value
- agrded value
- agrred value
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