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Massive loss: The size of the loss should be significant from the perspective of the insured. Insurance coverage premiums have to cowl each the expected value of losses, plus the cost of issuing and administering the coverage, adjusting losses, and supplying the capital wanted to moderately guarantee that the insurer will be able to pay claims. For small losses, these latter prices could also be several times the dimensions of the anticipated cost of losses. There is hardly any level in paying such costs unless the safety supplied has actual worth to a purchaser.