What is the term for losing the value of an asset after a covered peril occurs?

The term for losing the value of an asset after a covered peril occurs is "loss." In the context of insurance and risk management, a loss refers specifically to the reduction in value of an insured asset due to an event that has been identified as a covered peril in the insurance policy. This could be due to various events, such as fire, theft, or flooding, that directly affect the value and usability of the asset.

Understanding this concept is crucial for those involved in title insurance and property insurance, as it helps clarify how claims are assessed and how coverage is applied. For example, if a homeowner's property suffers damage from a fire, the decrease in property value resulting from that damage would be classified as a loss. This terminology forms the foundation of insurance practices, making it essential for professionals in the field to grasp fully.