Restoring a policy holder to his pre-loss financial position means Contribution Indemnity Good faith subrogation

The correct term that describes restoring a policyholder to their pre-loss financial position is **Indemnity**. ### Explanation: - **Indemnity** refers to the principle in insurance that ensures a policyholder is compensated for their loss, but not more than the actual loss incurred. This means that the insurance payout will restore the policyholder to the financial state they were in before the loss occurred, without allowing them to profit from the insurance claim. The other terms are defined as follows: - **Contribution**: This refers to the right of an insurer to seek a proportional share of a loss from other insurers that are also liable for the same loss. - **Good faith**: This refers to the obligation of both parties in an insurance contract to act honestly and not mislead or withhold critical information from one another. - **Subrogation**: This is the process by which an insurer, after paying a loss, can pursue a third party that caused the loss to recover the amount paid to the insured. Thus, the principle of indemnity is the one that directly relates to restoring a policyholder to their pre-loss financial position.