Which policy provision in property insurance prevents double recovery for the same loss?

The correct choice is subrogation, which is a policy provision in property insurance that prevents the insured from recovering twice for the same loss. When a loss occurs and the insurer pays the claim, the insurer may then have the right to pursue recovery from a third party responsible for the loss. This mechanism effectively transfers the insured's rights to the insurer regarding the claim, ensuring that the insured does not receive payment from both the insurer and the liable third party for the same incident.

The subrogation process ensures that the burden of the loss is ultimately borne by the party at fault, rather than the insured receiving a financial windfall from insurance reimbursement while also pursuing damages from the responsible party. This principle is fundamental in maintaining fairness in the insurance process and preventing unjust enrichment.

In contrast, the exclusion clause is intended to limit the insurer’s liability by specifying certain risks that are not covered by the policy, rather than addressing the issue of double recovery. The indemnity principle is a key concept in insurance that ensures an insured party is compensated for their loss but does not allow them to profit from the situation, which is related yet distinct from the process of recovery from liable parties. Lastly, proximate cause refers to the primary cause of a loss and plays a significant