In a situation where a home is damaged by fire, who has insurable interest if both owners are on the policy?

In the context of insurance, insurable interest refers to the requirement that someone must have a legitimate interest in the property being insured in order to receive benefits from an insurance policy. This is important because it prevents moral hazard—where someone could be incentivized to damage a property for profit.

In this scenario, both George and Sandy are named as owners on the insurance policy. This indicates that they both have a vested interest in the property, which means they would both experience a financial loss if the home were damaged by fire. Therefore, they share insurable interest in the home.

Having both parties listed on the policy strengthens their claim to the benefits provided under it since they both would be impacted by any potential loss. Insurance policies are designed to protect those who have a financial stake in the insured property, and as co-owners, George and Sandy meet the criteria for insurable interest. This allows them to both benefit from the coverage offered by the policy in the event of a loss due to fire or other perils.