A principle of insurance that states a person should be made whole, no better, no worse, is

Subrogation refers to the right of an insurer to pursue a third party that caused an insurance loss to the insured. This principle allows insurers to recover the amount they paid for a claim from the party responsible for the loss. While subrogation is related to indemnity, it serves a distinct function in the claims process rather than establishing the compensation principle itself.

Aleatory refers to contracts in which the performance depends on an uncertain event, such as insurance policies where premiums are paid in exchange for potential future payouts. This characteristic highlights the unequal nature of risk and benefit in insurance contracts, but it does not define the principle that ensures a person’s compensation aligns with their actual loss.

Adhesion describes contracts drafted by one party, where the other party has limited or no ability to negotiate terms. In insurance, policies are typically non-negotiable and presented on a take-it-or-leave-it basis. While this characteristic is significant in understanding contract law in insurance, it does not pertain to the principle of making the insured whole.