Essay On Insurable Interest

INSURABLE INTEREST

This article provides an insight into the concept of insurable interest by describing the nature of insurable interest and also explains the necessity of an insurable interest in regard to Life Insurance, Fire Insurance and Marine Insurance.

An insurable interest, generally, is that interest (required by law) created by the relation between the insured and the contingent event insured against which would cause a loss to the insured should the event actually occur. It is also such an interest which precludes any wagering intent on the part of the person who will benefit by the event occurring. Insurable interest is the reasonable concern of an individual to obtain insurance for any person or property against any unforeseen

Than people will simply insure the life of strangers and would be eagerly waiting for an early death and would be taking the immoderate advantage. Therefore, insurable interest is necessary to prevent the temptation of unlawful gain and to protect an insured person from moral hazards, wagering, and fraud.

Life insurance

Life insurance is a form of contingent interest which protects the interest in the life of a person. This stipulates that the person being insured cannot be some unknown person nor can there be any valid insurance without the consent of the person. This prevents to a larger extent the wagering on the life of a person. Person, when is taking the insurable interest in the life of another, is required to show the presence of insurable interest.

Every man is presumed to have an insurable interest in their own life and its continuance. The law also grants such presumption to some other relations as well i.e. Marriage (husband and wife), blood (father and son) or adoption (adopted son and his mother). The insurable interest needs to be shown at the time of commencement of the insurance and may or may not be there during the