What is meant by 'Loss Sustained' in insurance terminology?

'Loss Sustained' in insurance terminology refers to the concept of losses that are incurred during the active years of the policy. This means it relates specifically to the financial losses that occur while the insurance coverage is in effect. It's important to understand that this term helps in determining when and how losses can be claimed under an insurance policy, particularly in contexts such as property or casualty insurance.

In this context, the focus is on the duration of the policy and the fact that claims for losses are tied to the time when the policyholder was actively covered. This concept is crucial because it directly affects the ability to file a claim – if the incident that caused the loss occurred after the policy period ended, then the claim would typically not be covered.

The other choices do not accurately capture the essence of 'Loss Sustained.' Claims being approved after investigation deals with the claims process rather than the timing of loss occurrence, miscalculated claims adjustments refer to errors in settling claims rather than when losses are recognized, and unreported incidents during a policy period would not constitute 'Loss Sustained' as they imply losses that have not been acknowledged for coverage.