Abandonment Clause
What is an Abandonment Clause?
An abandonment clause is a provision in an insurance contract that ensures full compensation in the event of abandonment.
How Does an Abandonment Clause Work?
For example, suppose a company has an insurance policy on a machine, and the machine is damaged to such an extent that it is not worthwhile to pay for the repairs. The company may abandon the machine and collect on the insurance policy via the abandonment clause.
Why Does an Abandonment Clause Matter?
If the owner of an insured asset or property chooses to abandon it, an abandonment clause ensures that the insurer will pay the full coverage amount if the asset or property has damage that exceeds the asset's market value.
Personalized Financial Plans for an Uncertain Market
In today’s uncertain market, investors are looking for answers to help them grow and protect their savings. So we partnered with Vanguard Advisers -- one of the most trusted names in finance -- to offer you a financial plan built to withstand a variety of market and economic conditions. A Vanguard advisor will craft your customized plan and then manage your savings, giving you more confidence to help you meet your goals. Click here to get started.
Read This Next
