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Constructive total loss, which is a concept peculiar to marine insurance,1 is a legal device for determining the measure of indemnity.2 It is an intermediate form of loss between partial and actual total loss.3 More specifically, a constructive total loss (CTL) is a partial loss which is financially equivalent to a total loss, and may be treated as either at the election4 of the assured.5 If the requirements for a CTL are met, the assured may claim for a total loss of the vessel although the vessel, for instance, was not destroyed.6 It is because the words ‘total loss' are to be understood in the business sense of those words.7 Consequently, the actual existence of the thing is not conclusive against the loss being a total loss.8
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