Collateral Value Insurance

AAA

DEFINITION of 'Collateral Value Insurance'

A type of business insurance used by lenders to guarantee the value of appraised property. Collateral value insurance also guarantees a minimum liquidation value in the event the property must be sold. In most cases, the property being used as collateral is appraised before a certificate of guarantee is issued.

INVESTOPEDIA EXPLAINS 'Collateral Value Insurance'

Many insurers offer this type of protection, which is used primarily by asset-based lenders. In some cases, this type of insurance can be used for liquid assets such as closely held stock. Usually, however, it is geared for tangible property, such as buildings or equipment.

RELATED TERMS
  1. Collateral Value

    The estimated fair market value of an asset that is being used ...
  2. Lead Bank

    A bank that oversees the arrangement of a loan syndication. The ...
  3. Collateral

    Property or other assets that a borrower offers a lender to secure ...
  4. Loan

    The act of giving money, property or other material goods to ...
  5. Policy Loan

    A loan issued by an insurance company that uses the cash value ...
  6. Insurance

    A contract (policy) in which an individual or entity receives ...
Related Articles
  1. Retirement

    Borrowing From Your Retirement Plan

  2. Retirement

    Should You Borrow From Your Retirement ...

  3. Home & Auto

    New Wheels: Lease Or Buy?

  4. Credit & Loans

    Digging Out Of Personal Debt

Hot Definitions
  1. Capitulation

    When investors give up any previous gains in stock price by selling equities in an effort to get out of the market and into ...
  2. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  3. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  4. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  5. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  6. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
Trading Center