What type of loss requires a deductible payment according to property insurance policies?

The correct answer is direct loss. In property insurance policies, a direct loss refers to damage to the insured property that results from a covered peril, such as fire, theft, or windstorm. When a direct loss occurs, the insured typically has to pay a deductible, which is the amount specified in the policy that the policyholder must cover before the insurance pays for any of the remaining damages.

The rationale behind deductibles is to prevent small claims and encourage policyholders to take steps to avoid losses. Thus, by having a deductible associated with direct loss claims, the insurance company can manage the risk and costs associated with frequent minor claims.

In contrast, indirect loss involves the financial impact or additional costs that arise as a result of a direct loss, such as lost business income during property repair, and does not typically require a deductible payment. Excess loss does not pertain to the standard definitions found in property insurance and is not generally recognized in the context of deductibles. Consequential loss refers to losses that are not directly tied to an event but are a secondary effect, and again, these do not usually involve a deductible in the same way that direct loss does.