After a covered fire destroys a restaurant's kitchen, the restaurant must close for three months, losing $90,000 in revenue. The $90,000 in lost revenue is best classified as:

Why this is the answer

A direct loss is the immediate, tangible physical destruction of property — the charred kitchen equipment and structure. An indirect or consequential loss is a financial harm that would not have occurred but for the direct loss: the three months of lost revenue, extra expenses to rent a temporary location, or spoiled inventory that wasn't in the burning building. Business income (BI) coverage exists specifically to cover indirect losses. Standard property policies without a BI endorsement cover only direct losses. Distractor A is seductive because the fire caused both, but causation alone doesn't make a loss 'direct.'