Asked by Anita Inthavong on Jun 12, 2024
Verified
A means by which insurance law separates insurance contracts from wagering contracts is the typical requirement that the party who purchases a policy of property or life insurance must possess a(n) ________ in the property or life being insured.
A) warranty
B) codicil
C) reformation
D) insurable interest
Insurable Interest
A stake in an insured property or life that would cause a person to suffer financial loss if the property were damaged or if the insured person were injured or died.
Wagering Contracts
Agreements where the parties stand to win or lose based on the outcome of an uncertain event, often considered unenforceable due to their speculative nature.
Warranty
A guarantee given to the purchaser of an item by the seller, promising repair or replacement in case of defects within a certain period of time.
- Identify the consequences of contractual components in insurance policies, including warranties, representations, and the necessity for an insurable interest.
Verified Answer
RK
Rastko KojovicJun 13, 2024
Final Answer :
D
Explanation :
A major means by which insurance law separates insurance contracts from wagering contracts is the typical requirement that the party who purchases a policy of property or life insurance must possess an insurable interest in the property or life being insured.
Learning Objectives
- Identify the consequences of contractual components in insurance policies, including warranties, representations, and the necessity for an insurable interest.