What is required to insure a vehicle?

To insure a vehicle, it is essential to demonstrate an insurable interest. This means that the individual seeking insurance has a legal and financial stake in the vehicle, indicating that they would suffer a loss if the vehicle were damaged or destroyed. Insurable interest is a fundamental principle in insurance, ensuring that policies are issued to parties who have something to lose, thus preventing moral hazards where someone might intentionally cause damage or loss to collect insurance proceeds.

Having a valid driver's license, while important for operating the vehicle, is not a requirement for obtaining insurance coverage. Similarly, a clean driving record may be relevant for determining risk and premium rates but does not impact the fundamental requirement for insurable interest. Lastly, insurance history can provide insight into an applicant's risk profile but is not a prerequisite for insuring a vehicle. Thus, establishing an insurable interest is the key component that supports the validity of the insurance arrangement.