What is an example of a direct loss?

The option that represents a direct loss is the damage to a building caused directly by fire. A direct loss refers to physical damage to a property that is the result of a specific peril or event, such as a fire, which directly causes harm or destruction to the physical structure. In this instance, the fire has directly impacted the building, leading to its damage or destruction, which is typically covered under property insurance policies.

The other options illustrate different types of losses that may be indirect or consequential in nature. For example, loss of business income due to a fire originates from the damage but represents a secondary impact of the event rather than direct physical harm. Similarly, loss of inventory due to a shipwreck involves loss of property but does not represent damage incurred on-site. Costs incurred while repairing property, while necessary and related to the damage, represent expenses associated with restoring the property rather than direct damage itself. Thus, the correct choice highlights the physical damage arising directly from the specified event, clearly categorizing it as a direct loss.