Can you please explain insurable interest principle of insurance in simple words and with examples
Dear student,
Insurance interest means some pecuniary interest in the subject matter of contract of insurance. It is the interest that a person has on a property which is insured. A person has an "insurable interest" in something when loss or damage to it would cause that person to suffer a financial loss or certain other kinds of losses. Person who buys a policy must have an insurable interest in the subject of the insurance.
In every type of insurance there exists an insurable interest:
1. at the time of insuring; and
2. at the time of loss.
Regards
Insurance interest means some pecuniary interest in the subject matter of contract of insurance. It is the interest that a person has on a property which is insured. A person has an "insurable interest" in something when loss or damage to it would cause that person to suffer a financial loss or certain other kinds of losses. Person who buys a policy must have an insurable interest in the subject of the insurance.
In every type of insurance there exists an insurable interest:
1. at the time of insuring; and
2. at the time of loss.
Regards