Life assurance may be defined as a contract in which the insurer, in consideration of a certain premium, either in a lump sum or by other periodical payments, agrees to pay to the assured, or to the person for whose benefit the policy is taken, a stated sum of money on the happening of a particular event contingent on the duration of human life.
Life Insurance
Life assurance may be defined as
a contract in which the insurer, in consideration of a certain premium, either
in a lump sum or by other periodical payments, agrees to pay to the assured, or
to the person for whose benefit the policy is taken, a stated sum of money on
the happening of a particular event contingent on the duration of human life.
Life Insurance Is Not A
Contract Of Indemnity:
“The contract commonly called
life assurance when properly considered is a mere contract to pay a certain sum
of money on the death of a person, in consideration of the due payment of a
certain annuity for his life…. This species of insurance in no way resembles a
contract of indemnity.”
Insurable
Interest:
The assured must have at the time
of the contract an insurable interest in the life upon which the insurance is
effected.
Person
In His Own Life:
A person is presumed to have an
interest in his own life and every part of it, and can insure for any sum
whatsoever, and as often as he pleases.
Relatives:
A wife
has an insurable interest in the life of her husband, and vice versa.
Persons
Not Related:
A creditor has an insurable
interest in the life of his debtor to the extent of the debt.
Tags : Business Environment and Law-Law Of Insurance
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