AUTOMATIC INFLATION MARGIN Sample Clauses
The Automatic Inflation Margin clause establishes a mechanism for automatically adjusting contract prices or payments in line with inflation rates. Typically, this clause specifies a relevant inflation index, such as the Consumer Price Index, and outlines how and when adjustments will be calculated and applied to the contract’s financial terms. By doing so, it ensures that the real value of payments remains consistent over time, protecting parties from the eroding effects of inflation and reducing the need for renegotiation.
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AUTOMATIC INFLATION MARGIN. The sum insured under houseowners - buildings (section 1.), and householders - contents (section 2.) will increase at the end of each month by half a percent. No premium is payable for this increase and at the next renewal or anniversary date as the case may be the sums insured will be increased by a percentage commensurate with price indices for the preceding twelve months of insurance and the appropriate premium will be charged for the increased sums insured. This provision does not relieve you of the responsibility to ensure that the sums insured represent the full replacement value of the property at all times.