NISM Certifications · NISM-Series-X-B: Investment Adviser (Level 2) · Basics of Insurance
In insurance, the term 'insurable interest' means that the policyholder must:
Insurable interest means the policyholder stands to suffer a financial loss if the insured event occurs. Without such a financial stake, the contract is treated as a wager and is not enforceable, so insurance requires this interest to exist.
- AStand to suffer a financial loss if the insured event occursCorrect
- BBe a relative of the insurance agent
- CPay the premium in a single instalment
- DHold a demat account with a depository
Explanation
Insurable interest is the legal right to insure, arising because the person would suffer financial loss if the insured event happened. It is not linked to the mode of premium payment, the agent's relations or holding a demat account.
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