WAEC Commerce 1993 Question 41

Question 41

Insurance

When an insured person admits that he has indemnified, he means that

  1. A.the insurance company has accepted his claims
  2. B.the damaged property has been recovered
  3. C.he has paid his premium fully
  4. D.the insurance company has restored him to his former position
  5. E.he has recovered benefits lost through acting in bad faith
Show the answer and explanation

Answer: D (the insurance company has restored him to his former position)

Explanation

Indemnity means putting the insured back in the same financial position as before the loss.