V

Valued Policy Law. A statute governing property insurance that requires payment of at least the face amount of the policy in the event of a total loss, or a partial loss exceeding a percentage of the market value.

Variable Annuity. An annuity under which the annuitant's payments will vary, depending upon the results of an investment portfolio or in accordance with a formula prescribed in the annuity contract.

Variable Life Insurance. Life insurance under which the benefits will vary, depending upon the investment experience of a separate account supporting such a policy.

Verbal Threshold. A type of "no-fault" insurance provision in which the claimant has the right to sue for damages if certain named conditions (or thresholds) are met. For example, if the provision names broken bones or disfigurement as a threshold, an insured need only show that one of those conditions has occurred to be permitted to sue for damages.

Vesting. The principle that a beneficiary gains entitlement to benefits attributable to an employer's contributions under a pension plan within a specified time period.

Viatical Settlement Companies. Companies that arrange cash payments for the life insurance of terminally ill policyholders. These companies provide early payouts for the policyholder, assume the premium payments on the purchased policies and collect the face value upon the death of the insured.

Vicarious Liability. A legal doctrine that one person may be held liable for the acts of another. For example, an employer may be held vicariously liable for the acts of an employee.

Voluntary Market. The market in which insurers are free to choose which risks to accept; also referred to as the standard market.