In which situation is an insurance company not responsible due to a change in interest of the property?

An insurance company is not responsible for a loss in a situation where the policy owner and the named insured are different. In such cases, if there has been a change in the interest of the property—meaning that the person who purchased the insurance (policy owner) has a different stake in the property compared to the individual or entity named as the insured—this can lead to complications regarding coverage.

Insurance policies generally require an insurable interest, which means that the insured must have a legitimate financial interest in the property. When the policy owner does not have the same ownership stake or interest in the property as the named insured, it can create a conflict regarding the responsibilities of the insurance company. Thus, if a claim arises, the insurance company may not be liable to pay out based on this discrepancy in interests.

Other options present scenarios that typically do not negate the insurance company's responsibility. A reduction in property value, an increase in risk factors, or destruction of property generally involve conditions that the insurance company is still responsible for handling, provided they're within the terms of the policy. However, differing interest between the policy owner and the insured presents a significant structural issue that can lead to a denial of coverage.