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Hours clause

A reinsurance clause bounding in time what counts as a single loss, generally 72 or 168 hours depending on the peril.

Definition

The hours clause defines the window within which multiple damages are grouped into a single occurrence, seventy-two hours for a hurricane, one hundred and sixty-eight for other perils. It makes sense because a hurricane has a beginning, an end and a name. It becomes absurd for a software compromise planted one day, dormant for months then activated in waves, of which one cannot say on what day the event took place.

Example

Cyber catastrophe bonds are issued on a per-occurrence basis, applying a notion of occurrence, and thus an hours clause, to a peril that has no natural one.

Related terms
Also known as

hours clause, clause horaire, définition d'évènement, Clause des heures (hours clause)