Which scenario is eligible for coverage by the Insurers Insolvency Fund?

The Insurers Insolvency Fund is designed to provide protection to policyholders when their insurance carrier becomes insolvent. This fund exists specifically to help insured individuals or entities recover claims that would otherwise go unpaid due to the insurer's financial failure.

In the given scenario, when a pleasure yacht owner files a claim and finds their insurer is insolvent, they are seeking compensation for a covered loss under their insurance policy. The Insurers Insolvency Fund would step in to cover this claim, ensuring that the yacht owner does not face financial hardship due to the bankruptcy of their insurer.

The other scenarios presented involve different types of financial instruments or situations that do not fall under the direct coverage provided by the Insurers Insolvency Fund. In the case of a lender losing money or a construction firm facing performance issues, those scenarios relate to business risks or contractual obligations rather than direct insurance claims. Thus, they would not be eligible for recovery under the Insurers Insolvency Fund. Similarly, the freighter scenario involves physical damage but does not pertain directly to the type of coverage that this fund is intended to secure for individual insurance policyholders.