Known-Loss Doctrine Law and Legal Definition
Known-Loss Doctrine is a judicially created principle of Insurance law, which provides that one may not obtain insurance for a loss that one knows to have already occurred or is substantially certain to happen. The standard for the known-loss defense should be "whether the evidence shows that the insured was charged with knowledge which reasonably shows that it was, or should (have been), aware of a likely exposure to losses which would reach the level of coverage" at issue. However, this doctrine and its standards vary from jurisdiction to jurisdiction.
