Renewal Option

A renewal option is a clause in a contract, such as a lease or insurance policy, allowing one party to extend or renew the agreement beyond its original term. It typically specifies the conditions, duration, and any changes in terms for the renewal. This option provides continuity and flexibility, enabling the party to maintain the arrangement without renegotiating from scratch. Renewal options are often predefined, giving assurance of ongoing service or occupancy, and are beneficial for planning and stability for both parties.