- No, although liquidated damages are not stated as an exclusion, the definition of Damages does not include liquidated damages.
- What are liquidated damages?
- Sometimes it is difficult to quantify a loss in monetary terms. For that reason, the Insured and a third party may agree that if a loss were to occur, then the guilty party’s liability will be a pre-agreed amount.
- Liquidated damages is an amount of money agreed upon by the parties to a contract which one will pay to the other upon breaching the agreement or failing to perform as stipulated in the contract.