sue-and-labor clause

Definition of "sue-and-labor clause"
  1. A part of the contract in a marine insurance policy where the policyholder is obliged to make reasonable efforts to protect the insured property from damage or to minimize any losses, and the insurance company will cover the reasonable costs of these actions
How to use "sue-and-labor clause" in a sentence
  1. Because of the sue-and-labor clause, the policyholder had to protect the ship from the impending storm and the insurance company paid for the associated costs.
  2. The sue-and-labor clause allowed for coverage of expenses after the captain took preventive measures to avoid a large loss.
  3. Under the sue-and-labor clause, the insurer shouldered the costs after the policyholder took necessary actions to minimize property damage.

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