What does Ensuing Loss Clause mean? Read on to discover the definition & meaning of the term Ensuing Loss Clause - to help you better understand the language used in insurance policies.
Ensuing Loss Clause
An exception to an exclusion in a first-party property policy that applies in a special type of fact pattern where the damage caused by an excluded peril operates as a link in the "chain of events" that enables a covered peril to damage other property. Symbolically, a classic ensuing loss fact pattern can be represented as follows: excluded peril → excluded damage → covered peril → ensuing damage. Note that there must be two kinds of damages an initial loss and an ensuing loss. Most courts will not apply an ensuing loss provision if an excluded peril caused a covered peril that results in only one kind of damage.
We hope the you have a better understanding of the meaning of Ensuing Loss Clause.