Property insurance, in a particular way, guards valuable properties against harmful risks like theft, fire, or damages due to weather disturbances. Insurances as regards to floods, earthquakes, fire, and home are policy types belonging to property insurance. Since this type of insurance calls for property owners or users, there is a so called additional interest contained in the account records.
Additional interest, typically, refers to a lender. In the insurance world, it means the type of position that provides permission to other individuals or institutions who were initially not named as beneficiaries in a certain policy. Basically, additional interest means the same thing as the term “additional insured” in a car insurance system. It points to a person or organization previously excluded in the terms of the policy. In such a case as an auto lease, the leasing party is usually regarded as the Additional Insured as well as a lien holder on the car insurance. This enacts as a protection to the leasing company should it will be named in the complaint or accident caused by the driver who is at the same time, a policy holder.
Certain financing companies though would require the insured, having a car loan at hand, to include into the list his insurance policy as the lien holder and as an additional interest since cash interests in the vehicle and coverages are utterly in need. Usually, a lender or the loaning company requires their clients to have a certain insurance coverages plus a Full Coverage. The full coverage comprises the physical damage coverages of Collision and Comprehensive of the vehicle. This serves as their tactic in protecting the not-fully paid vehicle, as being one of their company assets.
Furthermore, additional insured is the entity that has the ownership interest in the car. Since the owner of the automobile clearly has the right of property, he can be held just as responsible as the driver of the car, who has also the right of possession, should an accident occur. Clearly depicted in the situation, the lessor or lender of a leased vehicle is “additional insured” on the policy, as well as the “additional interest”. With the car offered as collateral to that additional interest, the additional interest entity would be added to the policy as a lien holder.
Additional interest and additional insured certainly mean one thing in numerous areas but additional interest is more appropriately used on various property policies, than on a personal auto policy. In a life insurance policy, an insured can have his beneficiaries be included in the said policy as the additional interest. This may mean that a father can give his dependent sons and daughters the desired benefits through adding them as an additional interest to the policy instead of purchasing another separate policy. In property and liability insurance policies, another person, firm, or other entity can enjoy the privileges of being an additional named insured.