Which loss settlement condition states that insurance will not cover the full value of a complete set if only a part is damaged?

The Pair or Set Clause is the correct choice because it specifically addresses the situation where only a portion of a complete set of items has been damaged. In insurance policies, this provision states that if a part of a complete set (such as fine china, a matching set of furniture, or a collection of items) is lost or damaged, the insurer will only pay for the replacement of the damaged item and not the full value of the entire set. This means that the value covered under the policy is generally based on the actual loss incurred rather than the total worth of the set.

This clause serves to prevent overcompensation for loss and ensures that the insured is only compensated for the specific loss they have encountered, reflecting the principle of indemnity in insurance, which aims to restore the insured to their pre-loss financial position without allowing for a profit from the insurance payout.