Valued Clause

What Does Valued Clause Mean?

A valued clause is a provision in an insurance contract that specifies the exact amount the insurer will pay for certain defined losses. In the event of a loss, items listed in the valuation clause will receive the stated compensation, regardless of their actual cash value at the time of the loss.

Insuranceopedia Explains Valued Clause

Valued clauses are commonly used in property insurance. For example, a valued clause in a property insurance contract may specify that the insurer will reimburse any furniture losses at $700 per item. Even if the value of the table or couch has increased or decreased at the time of the loss, the insurer will pay the amount stated in the valued clause. In this case, the insurer would pay $700 for each piece of lost furniture.