Concept:When the same risk is insured by more than one insurance company under one policy or related policies, the principle of contribution applies so that all insurers share the loss fairly.
Explanation:Under the principle of contribution, if several insurance companies are liable for the same loss, they must contribute proportionally to the claim.
If one insurer pays the full amount of the claim, that insurer has the right to recover a proportionate share from the other insurers involved.
This principle prevents the insured from making a profit and ensures that each insurer bears only its fair share of the loss.
Contribution is different from subrogation, which enables an insurer to take over the insured's rights after paying a claim.
It is also different from indemnity, which compensates the insured for actual loss, and utmost good faith, which requires full disclosure of facts.
Because multiple insurers are liable under the same policy, the correct principle is contribution.
Answer:B. contribution