Consequential loss is a financial loss that results from a primary loss event rather than the physical damage itself.
Examples include revenue loss during repairs, extra expenses to keep operations running, and spoilage from a loss of power or access.
Policy mechanics
Not every policy includes consequential loss coverage; many add an explicit endorsement or a separate business interruption section. Limits, waiting periods, and income-verification requirements determine what is indemnified.
Claims workflow
Claims teams often need to review bookkeeping, payroll, and sales records to quantify indirect impacts. These are tested against indemnity formulas and deductibles built into the policy.