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JAMB Commerce 2013 Question 17

Question 17

Insurance

The difference between indemnity insurance and non-indemnity insurance is that the latter provides

  1. A.cover for exporters against risks.
  2. B.cover for importers against risks.
  3. C.full payment to the insured.
  4. D.consolation payment to the insured.
Show the answer and explanation

Answer: D (consolation payment to the insured.)

Explanation

Life and injury cannot be valued in money, so non-indemnity policies pay an agreed sum as consolation, not to restore a loss.