The concept of indemnification

Question

Quizplus · Accepted Answer

Indemnification is the principle that an insured should not profit from an insurance claim. The purpose of indemnification is to put the insured back in the same financial position he was in before the loss occurred. This means that the insured should not receive more than the actual loss suffered. The concept of an insurable interest is important to the indemnification principle because the insured must have a financial interest in the insured property in order to recover the amount of the loss.

The Concept of Indemnification