What term describes losses that occur as a result of a direct loss, such as rental loss due to property damage?

The term that describes losses occurring as a result of a direct loss, such as rental loss due to property damage, is "indirect loss." Indirect losses are secondary losses that arise from the consequences of a direct loss event. For example, if a property is damaged due to a fire, the direct loss would be the physical damage to the property, while the indirect loss could be the income lost from being unable to rent that property during the repair period.

In this context, the term captures the financial impact that a direct loss has on a property owner, which may include lost rental income among other financial repercussions. Understanding the distinction between direct and indirect losses is crucial in risk management and insurance, as it influences coverage needs and claims processing.

Inherent vice refers to the natural characteristics of certain items that can lead to their damage or deterioration over time. Liability concerns the legal responsibility one has for the consequences of their actions, particularly when damages or injuries occur to others. Limits of liability define the maximum amount an insurer will pay for a covered loss, but do not specifically describe the nature of the losses themselves. These concepts do not accurately address the scenario of losses resulting from direct property damage.