What is the measure of insurable interest in property according to Idaho Code section 41-1806?

The measure of insurable interest in property, according to Idaho Code section 41-1806, focuses on the extent of potential damage that the insured might incur. This concept revolves around the idea that an individual or entity can only insure property to the extent of their financial interest in it. If the property is damaged, the insured's potential loss in terms of financial impact must reflect their stake in the property. This ensures that insurance serves its purpose of indemnification without allowing for speculative gains or moral hazard.

The other choices, while related to aspects of property and insurance, do not capture the essence of insurable interest as defined by the law. Market value represents what a property could sell for in the current market, which is not necessarily reflective of the insured party's specific interest. Historical cost reflects the purchase price of the property but does not considering current value or potential losses. The frequency of insurance claims may provide insights into risks associated with the property but does not define the insurable interest itself. Thus, the focus on potential damage highlights the alignment of insurable interest with financial risk and responsibility.