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. Policy Loan

    A loan issued by an insurance company that uses the cash value ...
  4. Collateral

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

    The act of giving money, property or other material goods to ...
  6. Insurance

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

    Borrowing From Your Retirement Plan

    Left with no alternative but to take money out from your retirement savings? Here are some guidelines.
  2. Retirement

    Should You Borrow From Your Retirement Plan?

    It makes sense to dip into your savings in some cases, but you must be aware of the potential consequences.
  3. Home & Auto

    New Wheels: Lease Or Buy?

    These two major ways to obtain a car have very different advantages and drawbacks. Find out which is best for you.
  4. Credit & Loans

    Digging Out Of Personal Debt

    Find out why good intentions can put consumers in an even bigger hole than before.
  5. Retirement

    Getting A Loan Without Your Parents

    Use the 5 "W"s to finance your dreams without banking on a second signature.
  6. Options & Futures

    Home-Equity Loans: The Costs

    Learn the factors to consider when comparing the different programs offered by various lenders.
  7. Options & Futures

    Payday Loans Don't Pay

    Hold too tightly to this rescue line and you'll soon be drowning in debt.
  8. Credit & Loans

    Understanding The Mortgage Payment Structure

    We explain the calculation and payment process as well as the amortization schedule of home loans.
  9. Options & Futures

    Car Title Loans: Good Option For Fast Cash?

    These loans provide fast cash, but they could leave you deeper in debt - and without a car.
  10. Options & Futures

    The Reverse Mortgage: A Retirement Tool

    Discover another way to fund your retirement without having to make payments on a loan.

You May Also Like

Hot Definitions
  1. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  2. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  3. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
  4. Fixed Asset

    A long-term tangible piece of property that a firm owns and uses in the production of its income and is not expected to be ...
  5. Break-Even Analysis

    An analysis to determine the point at which revenue received equals the costs associated with receiving the revenue. Break-even ...
  6. Key Performance Indicators - KPI

    A set of quantifiable measures that a company or industry uses to gauge or compare performance in terms of meeting their ...
Trading Center