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Simple English definitions for legal terms
union-loss clause
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A quick definition of union-loss clause:
Union-Loss Clause: This is a term that refers to a clause in an insurance policy that is similar to the mortgage-loss clause. It is designed to protect the lender's interest in the property in case of damage or loss caused by a union strike or labor dispute. Essentially, it ensures that the lender will be compensated for any losses incurred due to such events.
A more thorough explanation:
A union-loss clause is a provision in an insurance policy that is similar to a mortgage-loss clause. It is designed to protect the interests of a lender or mortgagee in the event of a loss that is caused by a union or labor dispute.
For example, let's say that a manufacturing company has a loan from a bank that is secured by a mortgage on its factory. If the factory is damaged or destroyed by a fire that is caused by a union strike, the bank may not be able to recover the full amount of its loan from the company's insurance policy. However, if the policy includes a union-loss clause, the bank may be able to recover the full amount of its loan from the insurance company.
The union-loss clause is important because it helps to ensure that lenders are protected in the event of a loss that is caused by a union or labor dispute. Without this clause, lenders may be at risk of losing their investment if a borrower is unable to repay a loan due to a loss that is caused by a union or labor dispute.