Direct Loss
Definition of "Direct loss"
Property loss in which the insured peril is the proximate cause (an unbroken chain of events) of the damage or destruction. Most basic property insurance policies (such as the standard fire policy) insure against only direct loss and not indirect loss or consequential loss. For example, a fire within the wall structure of a house causes the drapes to catch fire, which in turn fans flames onto the furniture a direct loss. An indirect loss would be inconvenience of the inhabitants, who would not be able to sleep in their home, thus causing a drop in their efficiency at work.
Popular Insurance Terms
Attributes of a particular employee benefit plan. For example, a general characteristic of group life insurance is that the whole group is underwritten, not individual members. ...
Insurance that offers blanket coverage up to a certain dollar amount on all property of the classification covered by the policy. Floater policies, which cover property wherever it happens ...
Same as term Class: group of insureds with the same characteristics, established for rate-making purposes. For example, all wood-frame houses within 200 feet of a fire plug in the same ...
Section of the code that qualifies that the death benefit paid under a life insurance policy is received by the beneficiary income-tax free. These tax consequences apply regardless of the ...
Independent, nonprofit, membership hospital plan. Benefits provided include coverage for hospitalization expenses subject to certain restrictions: for example, semiprivate room only. A ...
Act of starting a fire; arson. Arson is a covered peril under a property insurance contract, provided that the owner of the property is not responsible for the arson. ...
Cost per unit of insurance. ...
Provision in a life insurance policy that if an insured dies within a given period of time, the beneficiary receives the face value of the policy plus its cash value. ...
Type of proportional reinsurance under which the ceding company (primary insurer) cedes a portion of the face amount of the life insurance policy it has underwritten to its reinsurer. The ...
Have a question or comment?
We're here to help.