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Which of the following insurance contract is not based on the Principle of Indemnity?

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Question: Which of the following insurance contract is not based on the Principle of Indemnity?

Options:

  1.  Fire insurance
  2.  Marine insurance
  3.  Life insurance
  4.  All

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1 Answer

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3. Life insurance

Life insurance is an insurance contract which is not based on the Principle of Indemnity.

More information:

Principle of Indemnity provides that the insured shall be paid as compensation for the losses caused to the goods by the insurer, only if the insurer does not make any profit out of the loss.

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