automatic reinstatement clause Definition | Business Dictionaries from AllBusiness.com

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Business Definition for: automatic reinstatement clause

automatic reinstatement clause

provision in a property or liability policy stating that after a loss has been paid, the total original limits of the policy are once again in effect. For example, assume a loss of $40,000 has been paid under a $100,000 property damage coverage homeowners insurance policy After payment of the loss, the original $100,000 is reinstated.

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