Which scenario depicts an indirect loss in the context of property damage?

In the context of property damage, an indirect loss refers to a financial impact that is not a direct result of the physical damage to property but instead occurs as a consequence of that damage. In this scenario, the loss of income due to property damage effectively illustrates an indirect loss.

When property is damaged, such as in the case of a fire or flood, the business or individual may experience disruptions that lead to a reduction or total loss of income while they are unable to operate normally. This financial consequence arises from the initial property damage, showcasing how indirect losses can stem from the inability to conduct business as usual.

In contrast, direct losses would involve expenses directly related to the damage itself, such as replacing personal goods or repairing damaged property. Compensation for physical injury is also a separate matter, typically falling under a different category of liability rather than property insurance. Thus, the loss of income due to property damage is a clear example of an indirect loss.