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by rocqua
620 days ago
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Because premiums will rise across the board, so people with an insurable interest pay premiums set for people who intend to gamble or manipulate their insurance. By demanding an insurable interest, insurance companies keep out gamblers and frauds. It also helps strengthen the idea that insurance shouldn't be abused or manipulated for a payout. |
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I don't see why this is true. The insurer still knows the item and its market value. So if the insured amount is higher than the market value then it only needs to increase the premium in those cases, not for everyone else.