Question

The policy provision found in property insurance policies that prevents the insured from collecting twice for the same loss is called

A) Subrogation
B) Consent to settle loss
C) Right of salvage
D) Appraisal

Answer 1

The provision that prevents double collection on the same insurance loss is called Subrogation, which allows the insurer to pursue third parties responsible for the loss and maintain fairness.

Step-by-step explanation:

The policy provision found in property insurance policies that prevents the insured from collecting twice for the same loss is called Subrogation. This provision allows the insurance company to take legal action against third parties that may have caused the loss, recovering the cost of the claim. By enforcing subrogation, the insurance company can ensure that the insured does not profit from the insurance policy, which helps in reducing the moral hazard and maintaining fairness in the insurance process.