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VACANCY

The condition of vacancy exists when neither contents nor tenants are present in the building. Care must be taken when "vacancy" exists, since most policies exclude certain coverages (e.g. freezing, vandalism and malicious mischief) if the building remains vacant after a specified period of days. (See Unoccupancy.)

VALID CONTRACT

See Contract.

VALUED (STATED AMOUNT, STATED VALUE) POLICY

A policy in which the company agrees to pay the fullface amount of insurance in the event of a total loss, with no allowance for depreciation. This type is most commonly used in all-risk inland marine forms covering items of particular values such as Jewelry, Furs, Silverware, Cameras and the like. The agreed value is determined by the Bill of Sale or by professional appraisal (at the insured’s expense) and (except for miscellaneous equipment such as camera lenses, tripods, etc. which may be covered by a blanket amount based on a percentage of the full schedule) must be specifically described in detail and a value given for each. The possibility of moral hazard cannot be overlooked in this class of insurance. Where personal articles are concerned, they may be added by endorsement to the Homeowners Policy.

VALUED POLICY LAW

Although practically all Standard Fire Policies limit recovery to the "actual cash value" of the property at the time of the loss, some states have special statutes which may modify or eliminate this limitation. The most common of these laws is one which requires the company to pay the full amount of insurance in the event of a total loss. In some states, the company can exercise its option "to rebuild or replace" the property instead of paying the policy amount. The effect of these laws is to discourage companies form "overinsuring" certain properties. In general, Valued Policy Laws pertain to real ratherthan personal property.

VANDALISM

See Malicious Mischief.

VERIFICATION, VERIFYING

One of various methods of checking the processed data recorded on any medium (punched card, magnetic tape or disk) for accuracy.

VIABLE

Literally, "capable of living and growing." Once a perfectly legitimate word. Met slow death at the hands of government and executive types; poor word is no longer "viable."

VICE, INHERENT

Not what you think. See Inherent Vice.

VOLUNTARY MARKET

Term used to describe those classes of risks which are generally acceptable to insurance companies. Sometimes called "Open Market." (See Residual Market.)

VOLUNTARY PROPERTY DAMAGE

See Physical Damage to Property of Others.