Contract under which the insurer agrees at inception to pay a stated sum in the event of a total loss without allowance for depreciation or appreciation. Partial losses are dealt with on an indemnity basis. Marine insurers issue valued policies on cargo (partial losses dealt with pro rata) and hulls (total loss only). Where a valued policy is not issued, e.g. open covers, a valuation clause is used.
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See: agreed value policy.
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See: Agreed amount clause.
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Property Insurance Policy which provides that a predetermined, fixed amount will be paid for total loss to property. Most fine arts and some inland marine policies are written on this basis.