Residual value insurance (RVI) started as a tool for the aviation industry in the 1970s, later expanding into property and real estate, particularly in the US.
In the late 1990s, insurance broker Peter Spencer was arranging ship mortgage indemnity (SMI) on some large bulkers for Fortis bank that incorporated an RVI element.
In subsequent years, he says demand for SMI waned as banks became comfortable with their lending and the market heated up.
