As the name suggests, the “Loss Payee” is a person or the bank that receives the insurance payment after losing the property or vehicle that the insurance policyholder owns. According to the laws, it is a clause in the insurance policy. It is used to cover the investment of other parties or banks from where you have got the loan against your vehicle or your property. For example, if you have a car on loan and have insurance for that car, if you met an accident, and your car is completely damaged beyond repair, your bank still owes money. When you claim the insurance, the insurance company will pay money directly to the bank or person you owe money. Here the bank is a loss payee.
Leave a Reply