Leased assets will depreciate over time, and may eventually be returned at a value below the level anticipated. This will reduce your ability to sell on these assets at an acceptable price or generate future income from them. Residual value insurance helps to protect this final value or provide a minimum guaranteed asset valuation at a specific future point in time.
Residual value insurance (RVI) is a niche class of insurance which helps you, and your lenders, to guarantee the future value of income-generating assets which you lease out to third parties. Due to changes in market conditions or even technology, you may find that the residual value of your equipment at the end of the lease is below the future value you anticipated when the lease was negotiated.

Achieving this asset-value certainty is an important way to balance your exposures in volatile markets, and helps to remove asset risk from your balance sheet. RVI can be an essential component of a structured finance solution, guaranteeing the residual value of income-producing core assets at a specified future date.

Example scenarios where RVI can help:

  • Fleets of cars – The value of your cars could decline sharply if the used-car market were to weaken
  • Aircraft – When your aircraft are returned to you by the airline at the end of their lease, you may wish to sell them or lease them again, but might instead be forced to write them off
  • Property – You will want to achieve a minimum rental income, regardless of market fluctuations, from your residential or commercial property (such as condominiums or an office block).
Industry sectors suited to residual value insurance

The following sectors are likely to benefit from residual value insurance, and Alesco RMS has significant experience in these industries:

Please get in touch

We welcome exploratory enquiries about residual value insurance, so do pick up the phone or email us. Our key contacts are listed below.

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Residual Value Risk Insurance Solutions Key Contacts