Provided by Guaranty Group

Residual Value Guaranty

Protect against unexpected or greater than expected loss of value for commercial real estate, aircraft and other assets.

Overview

Tokio Marine HCC underwrites Residual Value Guarantees (RVG) for aircraft, commercial real estate and other assets. RVG insurance protects policyholders against unforeseen loss of value of an asset by guarantying a future value. RVG may be used to ensure asset value, to obtain better financing terms or in corporate accounting.

Highlights

  • Eliminate lender / investor balloon refinance risk
  • Guaranty equity investors a minimum return
  • No minimum term 

Best for

  • Commercial Real Estate Property Owners
  • Freight and Passenger Aircraft Owners
  • Lessors and Lessees 

Summary of coverage

Aircraft and other assets

Eligible aircraft for RVG

  • Wide-body, narrow-body and regional jets will be considered
  • Concentration on the most popular Airbus and Boeing models

Term of coverage

  • No minimum term required
  • Length of coverage: 12 years or less

Amount of guaranty

  • Typical guaranty: 20% to 40% of current value or 50% to 100% of the projected Ascend Soft Value at risk expiry
  • RVG pricing varies depending on the attachment point, amount of insurance and portfolio diversification

Aircraft return conditions

  • In compliance with terms contained in the lease, but special conditions can be added
  • Typically full-life, but half-life and other conditions are available 
Eligible real estate
  • Office
  • Retail
  • Industrial
  • Warehouse

Term of coverage

  • No minimum term required
  • Maximum length of coverage: 30 years

Ownership structures insured

  • Upon claim payment, TM HCC must be in a primary lien position
  • Insured must be bankruptcy-remote

Amount of guaranty

  • Typically, RVG of 25% to 35% of fee simple market value is underwritten, but higher residuals are considered depending on the quality of the assets and structure of the transaction
  • RVG premium varies depending on the attachment point and amount of guaranty offered but generally is 4% to 7% of the amount guaranteed

Required property return conditions:

  • In compliance with maintenance terms contained in the property lease
  • Industry-standard maintenance must be performed during the lease term
  • Property must be returned in good and marketable condition
  • In compliance with all rules, regulations and laws regarding environmental condition
  • Casualty and condemnation insurance is required
Get in touch
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Bradley DeLamielleure

Lead Underwriter

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Joseph Mastromarino

Managing Director

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Amy Johnson

Operations Director-IG

Your team

Directory
Head office

600 Lexington Avenue, 22nd Floor
New York, NY 10022

(212) 751-8383
Contact photo
Bradley DeLamielleure

Lead Underwriter

Contact photo
Joseph Mastromarino

Managing Director

Contact photo
Amy Johnson

Operations Director-IG

Robert Lewin
Robert Lewin

Managing Director

Contact photo
Peter Brande

Structured Credit Underwriter

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Rich Clark

Director Risk Management

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why choose tmhcc

Why choose Tokio Marine HCC?

Tokio Marine HCC is a leading specialty insurance group with offices in the United States, Mexico, the United Kingdom and Europe, transacting business in approximately 180 countries and underwriting more than 100 classes of specialty insurance.

More about us Financial strength

Not all products, coverages, or features may be available in all states. Restrictions, exclusions, limitations, and conditions apply and you should see your agent for more information. Certain products and services are provided through non-admitted insurance carriers and are not subject to certain State Guaranty Funds.