John O’Neill owned a house worth €350,000 and had insured it for €300,000 when a fire caused a partial loss of €63,000 - Leaving Cert Business - Question 10 - 2010
Question 10
John O’Neill owned a house worth €350,000 and had insured it for €300,000 when a fire caused a partial loss of €63,000. Calculate the amount the insurance company wi... show full transcript
Worked Solution & Example Answer:John O’Neill owned a house worth €350,000 and had insured it for €300,000 when a fire caused a partial loss of €63,000 - Leaving Cert Business - Question 10 - 2010
Step 1
Name the principle of insurance that applies in (a) above.
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Answer
The principle of indemnity applies in this case. This principle ensures that the insured is compensated for the loss incurred but does not profit from the insurance claim.
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