There are two questions, thus please choose only one out of two questions below, either Q1 or Q2, and write question number on top of your answer. Also, mark your answer for each sub- question as a, b or c. Make sure to use at least 3 sentences to answer each sub-question. Q1: Bander purchased a new car worth $40,000. He obtained a $30,000 loan from the AUTO Bank to buy the car. Usually he parks his car in guarded places-during work hours he parks it in the company's underground garage; and at night he parks it in his garage located in his house. One day, after the work he noticed something unexpected: a "drawing" on his car's bonnet. Unfortunately, it was made by a nail. The cost of the car's renovation was valued at $2,000. He reported this case to the police and to his insurer, because acts of vandalism were included in his auto insurance. After a short investigation, with the help of monitoring devices installed in the company garage, the police identified the perpetrator to be Jahil, one of Bander's co-workers. a) Do any of the following parties have an insurable interest in the car at the time of loss? Explain your answer for each. 1. Bander 2. Jahil 3. AUTO Bank 4. Bander's company (the owner of the garage) b) Which of the parties (Jahil, Bander's company, or Bander's insurer) should Bander claim for compensation? Explain your answer. c) Could Bander's insurer use the right of subrogation after paying the compensation to Bander? Explain your answer. Q2: Hamid age 25, has a comprehensive auto insurance from Smart Auto Insurance on his 2015 Toyota Camry. The policy has an age restriction of 21 years or older for drivers. His younger brother Walid age 18, took Hamid's car without permission and was hit by his friend Salem's car while both were racing. Upon being informed about the incident Hamid quickly arrived at the place of accident. Hamid asked Salem to pay for the damages caused and treated to report him to the police with racing incident otherwise. Salem eventually agreed and paid the amount demanded. But later Hamid reported the same loss as a hit and run case to the police and to his insurance company, and request Smart Auto for compensation. While reporting damages on his car, Hamid also added pre-existing faulty radiator and motor oil leakage as additional damages caused by the incident. After receiving a sworn statement from Hamid, Smart Auto has compensated him for all of the reported losses. a) Analyzing the above case, indicate which of four principles of insurance were violated and which is the only principle NOT violated? Support your answers with facts from the case. b) If Principle of Indemnity was violated, which action(s) was the cause? What could have Smart Auto done to reduce such violation? c) Finally, what actions or precautions would you recommend for Smart Auto to follow in order to reduce such violations of the principles of insurance (mentioned in part a) by its clients