Canadian Accredited Insurance Broker (CAIB) Two Practice Exam

Who typically has an insurable interest in property during inland transportation?

1. The Insured and the Carrier

2. The owner and the supplier

3. The insurer and the carrier

4. The consignee and the agent

The correct answer is: The Insured and the Carrier

The correct choice is based on the concept of insurable interest, which refers to the stake that an individual or entity has in a property or asset that provides them with a legal right to insure it. In the context of inland transportation, both the insured (the party that holds the insurance policy) and the carrier (the entity responsible for transporting the goods) typically have an insurable interest in the property being transported. The insured has an interest because they own the property, which may suffer a loss or damage during transportation. They rely on their insurance policy to protect their financial investment. The carrier also has an insurable interest because they take possession of the property and are responsible for its safety during transit. If the goods are damaged or lost while in their care, they can face liability and financial exposure. Thus, both parties have valid reasons for securing insurance against potential losses while the property is being transported. In contrast, the other choices highlight different relationships that may not align with the fundamental principle of insurable interest during inland transportation. The owner and supplier might not both have direct control or claim to the property during its transport. The insurer is the one providing the coverage and typically does not have an insurable interest, while the consignee and the agent