State with Reasons whether the following statements are TRUE or FALSE:
5. The principle of indemnity applies to life insurance- False
Explanation:
According to the principle of indemnity, the insurer assures the insured that he/she will bring the insured back to the position he/she was in prior to the occurrence of an uncertain event. In case of life insurance, it is not possible for the insurer to compensate the life of the insured. Thus, the principle of indemnity is not applied to life insurance.
