Question

What is the principle of insurable interest in insurance? 

A The insured must have a financial or other interest in the subject matter of the insurance policy Correct Answer Incorrect Answer
B The insurer must have a financial interest in the subject matter of the insurance policy Correct Answer Incorrect Answer
C The insured must have no interest in the subject matter of the insurance policy Correct Answer Incorrect Answer
D The insurer must have no interest in the subject matter of the insurance policy Correct Answer Incorrect Answer

Solution

The principle of insurable interest requires that the insured must have a financial or other interest in the subject matter of the insurance policy, which means they will suffer a financial loss if the subject matter is damaged or destroyed.

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