The practical effect of an agreed value provision on a property policy is that:

a.The limit rises automatically during the term
b.The coinsurance condition is suspended for the term
c.The deductible is suspended for the policy term
d.The insurer values all contents at replacement cost

Giải thích

Under an agreed value provision the insurer and the insured settle on a value in advance, usually from a signed statement of values, and the coinsurance condition is set aside so no penalty can be assessed on a partial loss. It does not remove the deductible, which still applies to every loss. Automatic increases in the limit describe inflation guard, a different feature.

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