What does the principle of insurable interest require?

AThe insurer must always pay out the full sum insured regardless of loss

BThe insured may insure any person's property, not only their own

CThe insured must directly suffer loss if the risk insured against occurs

DThe insured must pay the full value of the item as a premium

Explanation

Insurable interest requires that the insured directly suffers loss if the risk occurs.

Derived from ZIMSEC Commerce 7103/2 Paper 2, June 2004, Q9

Get the full paper, not just one question

Danho has every sitting for this paper, with your progress tracked question by question, offline.