What is required for an individual to have insurable interest in a property?

An individual must have financial ties to a property to establish insurable interest. Insurable interest means that the individual would suffer a financial loss if the property were damaged or lost. This concept is crucial in insurance because it prevents moral hazard, where a person may be incentivized to cause harm to something they have no financial stake in. Financial ties can include ownership of the property, a mortgage, or any form of financial investment that indicates the person stands to lose money if the property is compromised.

The other options do not fully encompass the requirement for insurable interest. Joint tenancy pertains to the manner of ownership but does not necessarily create an insurable interest on its own. Living in the property or having it as a commercial venture could suggest a connection, but they are not prerequisites for having a financial stake that would constitute insurable interest.