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additional interest

In additional interest, what is the difference between an insured-lessor, certificate holder, and a loss payee?

Additional Interest

An additional interest is a person or an entity that financed the property’s purchase. An additional interest receives no coverage. Additional interests always get notification when changes to the policy are made. These changes may include policy cancellations, renewals, or failure to renew a policy. Adding an additional interest to an insurance policy does not affect the premium for the policyholder.


The lessor is the legal owner of the asset, giving the lessee the right to use or occupy the asset or property for a specific period. In the case of auto insurance, the owner of the vehicle gives the right to use his vehicle to another person.

The lessor will also be compensated for any losses incurred during the contract due to damage or misuse of the asset.

Certificate holder

The certificate holder is the person who will receive the COI (Certificate of Insurance) from the insured. The insured provides the COI to the certificate holder as proof that they have proper coverage. COIs do not give the certificate holder the ability to make a claim on the policy or make any changes to the policy.

Loss payee

A loss payee is a party or entity that will get paid first if there is any loss connected with a property in which it has a financial interest. The loss payee will be compensated by the insurance company if any loss is incurred. The loss payee is added separately from the named insured.

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