first loss policy definition

first loss policy

Type of partial insurance (which covers less than the full value of goods or property at risk) where both the insured and the insurer acknowledge that the 'subject to average' (see average) rule does not apply. These policies cover only the estimated largest possible loss, and are used commonly in the burglary or theft insurance where the possibility of total loss is extremely remote (such as in case of a large store).

first loss policy is in the General, Marine, & Life Insurance subject.

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