CIPS Exam L5M2 Topic 1 Question 7 Discussion

Actual exam question for CIPS's L5M2 exam

Question #: 7
Topic #: 1

[All L5M2 Questions]

The legal principle of insurable interest means which of the following statements are TRUE? Select TWO.

Ait is possible to insure someone else's factory

Bit is not possible to insure someone else's factory

Cit is possible to insure your supplier's factory

Dit is not possible to insure your supplier's factory

Show Suggested Answer

Suggested Answer: B, C

Insurable Interest means that it is not possible to insure someone else's factory. The study guide explains that you can only take out insurance where you have at least partial ownership of that risk. Therefore option 3 is also correct as you have a partial risk if something were to happen to your supplier's factory. You can take out CBI insurance for this. see p.100-101 for further s of Legal Principles of Insurance

by Simona at Dec 06, 2022, 09:12 PM

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