Dismiss a "Something the insurance policy will cover" (4)
I believe the answer is:
fire
'dismiss' is the definition.
(synonyms)
I cannot understand how the rest of the clue works.
Can you help me to learn more?
(Other definitions for fire that I've seen before include "Inspire" , "There's no smoke without it" , "Trigger" , "Let off" , "See 5" .)