Question

Select the proper option from the options given below and rewrite the completed sentences.

Insurable interest must exist in ________.
(a) Life insurance contract only
(b) Marine insurance contract only
(c) Every insurance contract

Answer 1

Correct option - c
Insurable interest must exist in every insurance contract.
Explanation:
Insurable interest is a financial benefit that the insured derives from the existence of the product that is insured. For example, a person would have insurable interest in his own car and not in his neighbour's car. This simply implies that the insured has an interest in the subject matter of insurance. This insurable interest is essential to all insurance contracts.