Life & Health · Chapter 1 · Industry Basics
Valued Contract
Definition
Pays a fixed, predetermined amount regardless of actual loss. This is how life insurance works.
Exam tip
Indemnity = actual loss (health/P&C). Valued = stated amount (life). You can't price the 'actual loss' of a life.
Easy to confuse with
These are what this term gets tested against — if you can't tell them apart cold, drill the contrast.
Related terms