Allowing people to insure property that they have no real interest in may lead to the intentional destruction of the property.To which rule does this rationale apply?

Question

Quizplus · Accepted Answer

The rationale applies to the insurable interest rule, which requires that the person purchasing insurance on a property or life must have a legitimate interest in the preservation of the subject of the insurance. This prevents people from benefiting from the loss or destruction of the property or life insured, thereby reducing the risk of moral hazard such as intentional damage.

Allowing People to Insure Property That They Have No Real