Property-Insurance Terms & Related Concepts Exam Questions with Answers 100% Correct || (2024) Certified!!!

Insurance - The TRANSFER of financial responsibility associated with a potential of a loss (risk) to an insurance company, which in turn spreads the costs of unexpected losses to many individuals. Insurance - Contract in which one party agrees to indemnify the other party against loss, damage, or liability arising from an unknown event. Indemnify - Compensate (someone) for harm or loss: "insurance carried to indemnify the owner for loss". Insurable Interest - The insured must have an insurable interest in the person or property covered by an insurance policy. In property insurance, the insured would incur a financial loss if the insured property was damaged. Maybe created by the ownership, custody, or control of a property. Must be demonstrated when policy is issued and always exists at the time of loss. Insurable Interest Example - Mortgages and leaseholders may have an insurable interest in the property. 3 Elements of Insurable Risk - 1. Financial-a monetary interest 2. Blood-a relative 3. Business-busines partner Risk - The uncert