The principle of _____________ ensures that an insured does not profit by insuring with multiple insurers.

Question

Question: The principle of _____________ ensures that an insured does not profit by insuring with multiple insurers.

Options:

1. Subrogation
2. Contribution
3. Co-insurance
4. Indemnity
5. Particular Average

Answer 1

2. Contribution

The principle of contribution ensures that an insured does not profit by insuring with multiple insurers.

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More info:

The principle of contribution inborn from the principle of indemnity.

When multiple insurance policies are covering the same property or loss, the total payment for actual loss is proportionally divided among all insurance companies, the principle of contribution is implemented.

In simple, the principle of contribution ensures that an insured does not profit by insuring with multiple insurers.