What principle asserts that the insurance will pay only once, even if the insured holds multiple policies?ContributionSubrogationIndemnityProximate cause

The principle that asserts that insurance will pay only once, even if the insured holds multiple policies, is known as Contribution.

Explanation:

1. Contribution is applicable when an insured has taken out multiple insurance policies with different insurers covering the same risk. In such cases, if a loss occurs, each insurer pays a proportionate part of the claim based on the coverage provided. This principle prevents the insured from profiting from multiple claims for a single loss.

2. Other principles mentioned:

   • Subrogation refers to the insurer's right to pursue a third party responsible for a loss after paying the insured.
   • Indemnity ensures that the insured is compensated for their loss without profit, restoring them to their financial position before the loss.
   • Proximate cause is used to determine the cause of loss, which must be closely related to the insured risk for coverage to apply.

In conclusion, the correct answer is Contribution.