Characteristics: Calculable Loss

There are two elements that must be estimable in nature, if not formally calculable: The probability of the loss and the attendant cost.

Probability of a loss is typically an empirical exercise, while cost has more to do with the ability of a reasonable person, who is in possession of a copy of said insurance policy as well as a proof of loss for a claim presented under that policy, to make an objective and definite evaluation or estimation of the amount of the loss that is recoverable as a result of the claim.

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