Insurance Awareness - Health Insurance
Which of the following best describes the principle of 'Insurable Interest' in health insurance?
Which of the following best describes the principle of 'Insurable Interest' in health insurance?
hard Q9 of Q15
Step-by-Step Solution
Step 1: Understand 'Insurable Interest'
Insurable interest means the insured must stand to suffer a financial loss from the event insured against.Step 2: Analyze options
The insured must have a financial interest in the subject matter of insurance correctly defines insurable interest. The insurer must act in utmost good faith describes utmost good faith, The insured is indemnified only to the extent of loss suffered describes indemnity, and The insured must disclose all material facts describes disclosure of material facts.Final Answer:
The insured must have a financial interest in the subject matter of insurance → Option AQuick Check:
Only The insured must have a financial interest in the subject matter of insurance correctly defines insurable interest.
Quick Trick: Remember insurable interest means financial stake in the insured risk.
Common Mistakes:
MISTAKES- Confusing insurable interest with other insurance principles.
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