A member does nit have a insurable interest in the company meaning
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A person has an insurable interest in something when loss or damage to it would cause that person to suffer a financial loss or certain other kinds of losses. In order to exercise an insurable interest, you must take out an insurance policy protecting the item.
Examples of Insurable Interest
If the house you own is damaged by fire, the value of your house has been reduced by the damages sustained in the fire. Whether you pay to have the house rebuilt or you end up selling it at a reduced price, you have suffered a financial loss resulting from the fire. By contrast, if your neighbor's house, which you do not own, is damaged by fire, you may feel sympathy for your neighbor and you may even be emotionally upset, but you have not suffered a financial loss from the fire. You have an insurable interest in your own house, but in this example you do not have an insurable interest in your neighbor's house.
Examples of Insurable Interest
If the house you own is damaged by fire, the value of your house has been reduced by the damages sustained in the fire. Whether you pay to have the house rebuilt or you end up selling it at a reduced price, you have suffered a financial loss resulting from the fire. By contrast, if your neighbor's house, which you do not own, is damaged by fire, you may feel sympathy for your neighbor and you may even be emotionally upset, but you have not suffered a financial loss from the fire. You have an insurable interest in your own house, but in this example you do not have an insurable interest in your neighbor's house.
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