Which term refers to the responsibility to repair or replace property after a loss?

The correct term that refers to the responsibility to repair or replace property after a loss is indemnity. Indemnity is a fundamental principle in insurance that aims to restore an insured party to the financial position they were in prior to the loss, without allowing them to profit from the insurance coverage. This means that when a covered loss occurs, the insurance company will either repair the damaged property or provide a payment for its replacement, aligning with the obligation to indemnify the insured.

Liability coverage, on the other hand, pertains to the protection provided against claims resulting from injuries and damage to other people or their property caused by the insured. Subrogation is the process through which an insurance company seeks reimbursement from a third party that caused a loss to an insured party. A deductible is the amount that a policyholder is required to pay before the insurance coverage kicks in, affecting the payout but not directly relating to the responsibility of repair or replacement. Therefore, indemnity is the term that captures the essence of the obligation to repair or replace property after a loss has occurred.