Which statement best reflects the concept behind the rule of indemnity?

Multiple Choice

If a written contract exists between the insured and an insurance company, the insured is entitled to receive the maximum amount stated in the contract in the event of a loss.

An insured person cannot collect more than the actual loss from an insurable risk.

If an insurance company$$s premiums generate excess funds, these excess funds must be returned to the policyholders in the form of dividends or reductions in future premiums.

If a large number of people are exposed to the same risk, a predictable number of losses will occur during a given period of time.