INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.
-The Principle of [Indemnity | Peril] states that the insured may not be compensated by the insurance company in an amount exceeding the insured's economic loss.
A)for the first item
B)for the second item
C)if neither item will correctly complete the statement.

Question

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-The Principle of [Indemnity | Peril] states that the insured may not be compensated by the insurance company in an amount exceeding the insured's economic loss.
A)for the first item
B)for the second item
C)if neither item will correctly complete the statement.

Quizplus · Accepted Answer

The phrase "Principle of Indemnity" refers to the concept that the insurance company should only compensate the insured for their actual economic loss. The term "Peril" refers to a specific cause of loss, such as fire or theft, and is not related to this principle.

INSTRUCTIONS: Choose the Word or Phrase in [ ] Which