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Describe the Effect of an Appraisal Clause in a Policy

question 52

Essay

Describe the effect of an appraisal clause in a policy of insurance, and explain how these usually work.


Definitions:

Stock Splits

A corporate action where a company divides its existing shares into multiple shares to boost the liquidity of the shares, although the overall value of the company does not change.

Market Price

The present cost at which services or assets are offered for trade in the market.

Extra Dividend

A one-time payment made by a company to its shareholders, in addition to any regular dividends.

Liquidating Dividend

A payment made by a corporation to its shareholders during its liquidation, distributing the remaining assets.

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