Insurable interest means that the insured must suffer a pecuniary or financial loss.

Question

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Insurable interest refers to the financial or monetary stake that the insured party has in the subject matter of the insurance policy. In other words, the insured must stand to suffer a financial loss if the insured event occurs, and this loss must be quantifiable in monetary terms. Without insurable interest, the insurance contract would be considered a form of gambling, which is generally illegal.

Insurable Interest Means That the Insured Must Suffer a Pecuniary