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Franchise

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Glossaries

Term Definition
Franchise

The option in cargo insurance is applied in case of loss and implies the participation of the Policyholder and the Beneficiary in the risk.

When insuring goods, an unconditional deductible is usually used, which means that if a loss occurs less than the deductible, it is not considered and is not paid. If the loss is greater than the deductible, then the compensation will be the amount of the damage caused minus the deductible.Franchise- it's like some participation in the risk of the policyholder. In addition to the deductible, the policyholder must pay the insurance premium.