In a noninsurance situation, the exchange of unequal amounts sounds unfair. For example, Katie paid Nicolas $4,000 to repair her roof, but the repairs were actually only worth $1,000. Which one of the following best describes why the exchange of unequal amounts isfair in insurance contracts?
A The insurer's obligations often perfectly mirror the insured's obligations.
B Unlike noninsurance contracts, insurance contracts rely on utmost good faith.
C The value of a promise to cover a loss is the equivalent of all insured's obligations.
D There is the possibility that the insurer's obligation might be much greater than the insured's.