Which of these is the best way to define the concept of "indemnity?"

Which of these is the best way to define the concept of "indemnity?"



A) It's only when concealed facts are material that an insurer can rescind or cancel a policy.

B) Only the insurance company makes a legally enforceable promise.

C) An insured cannot receive more than an actual economic loss in the event of a claim.

D) If there is an unclear statement in a contract of insurance the courts will rule in favor of the insured.

C) An insured cannot receive more than an actual economic loss in the event of a claim.


Answer: The concept of indemnity is to "make whole" or to be brought back to the same condition as before the loss. It is neither to make a gain nor to have a loss.

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