Question

The clause that protects the lender in a real property policy is the:

1) Coinsurance Clause
2) Loss Payee Clause
3) Appraiser Clause
4) Mortgagee Clause

Answer 1

The clause that protects the lender in a real property policy is the Mortgagee Clause, which ensures the lender's interests are secured in the event of a policy violation by the insured.

Step-by-step explanation:

The clause that protects the lender in a real property policy is the Mortgagee Clause. This provision specifically safeguards the interests of the lender or mortgagee, ensuring they have the right to receive settlement in the event of a loss, even if the policyholder violates the policy terms. It serves as protection for the lender's investment in the property used as collateral. The coinsurance clause is related to the shared risk between the insurer and the policyholder, where both pay a portion of the loss. The loss payee clause is similar to the mortgagee clause but can apply to personal property as well as real property.

The clause that protects the lender in a real property policy is the Mortgagee Clause.The clause that protects the lender in a real property policy is the Mortgagee Clause, which ensures the lender's interests are secured in the event of a policy violation by the insured.

On the other hand, the appraiser clause allows for the appointment of appraisers to determine the value of the insured property in case of a dispute.