What is an 'Embedded Value'
An embedded value is a common valuation measure used outside North America, particularly in the insurance industry. It is calculated by adding the adjusted net asset value and the present value of future profits of a firm. The present value of future profits considers the potential profits that shareholders will receive in the future, while adjusted net asset value considers the funds belonging to shareholders that have been accumulated in the past.
BREAKING DOWN 'Embedded Value'
Embedded value is a conservative valuation method, as it excludes certain aspects of goodwill from its calculation of a company's worth. Goodwill includes intangible assets that increase the value of a company beyond its assets minus liabilities, such as strong management, good location and a happy workforce. Furthermore, to add to its conservatism, the EV calculation of a firm does not allow for any increase in future business.

Book Value
1. The value at which an asset is carried on a balance sheet. ... 
Historic Pricing
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A measure of a company's valuation after liabilities, including ... 
Adjusted Net Asset Method
A business valuation procedure used in acquisition accounting ... 
Adjusted Present Value  APV
The Net Present Value (NPV) of a project if financed solely by ... 
Modified Book Value
An assetbased method of determining how much a business is worth ...

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