New York State Life Insurance Exam Questions Practice Question
A principle of insurance that states a person should be made whole, no better, no worse, is
Correct Answer: C
Rationale: The principle of indemnity ensures that an insured party is compensated for their loss without profiting from it, maintaining financial equilibrium.
Option A, subrogation, refers to the insurer's right to pursue a third party responsible for a loss after compensating the insured.
Option B, aleatory, describes contracts where outcomes depend on uncertain events, such as insurance policies, but does not address the compensation principle.
Option D, adhesion, pertains to contracts created by one party, typically favoring the insurer, and does not relate to the concept of making someone whole.
Unlock All Questions
Subscribe to Premium for full access to all practice questions, detailed rationales, and performance tracking.
Subscribe Now