A more thorough explanation:

A standard mortgage clause is a provision in an insurance policy that protects the rights of a mortgagee when the insured property is subject to a mortgage. This clause ensures that the mortgagee's interest in the property is protected even if the insured mortgagor does something to invalidate the policy.

For example, if a homeowner with a mortgage takes out an insurance policy on their home and then commits fraud, the insurance company may deny coverage. However, with a standard mortgage clause, the mortgagee's interest in the property would still be protected, even if the homeowner's coverage is invalidated.

The standard mortgage clause typically provides that any insurance proceeds must be allocated between the named insured and the mortgagee "as their interests may appear." This means that the mortgagee will receive a portion of the insurance proceeds based on their stake in the property.

Overall, the standard mortgage clause creates a separate contract between the insurer and the mortgagee, ensuring that the mortgagee's interest in the property is protected in the event of a loss.