salvage loss

(insurance) A method of insurance adjustment where the underwriter pays the difference between the amount of insurance and the net proceeds of the sale of damaged goods. It is sometimes incorrectly assumed that when damaged goods are sold to determine the extent of loss, the underwriter is obligated to pay the difference between the amount of insurance and the net proceeds of the sale. The salvage loss method is regularly used only if goods are justifiably sold short of destination.

Was this article helpful?

Related Articles

Need Support?

Can't find the answer you're looking for?
Contact Support