Mataracy
VIP Contributor
It is known that insurable risks must possess some characteristics i.e they must have pecuniary value, large number of similar exposures, pure or fundamental, loss must be accidental or fortuitous. It must not be against public policy, the premium must be reasonable and insurable interest must be present.
Since we have seen the important of insurable interest to every contract of insurance, attempt must be made here to define it. I know must have asked question that " what is it that insured in a fire policy?". Not the bricks and materials used in building the house, but the interest of the insures is the subject matter of insurance. The subject -matter of insurance will be the physical structure like , house, ship,machinery, potential liability, motor vehicle etc. Therefore it is th3 financial interest of the owner in these properties that amouns to insurable interest. It is this financial interest that is known as the subject matter of the contract.
Insurable interest can therefore be difined as the legal right to insure arising out of a financial relationship, recognized at law as existing between the insured and the subject matter of insurance.
Since we have seen the important of insurable interest to every contract of insurance, attempt must be made here to define it. I know must have asked question that " what is it that insured in a fire policy?". Not the bricks and materials used in building the house, but the interest of the insures is the subject matter of insurance. The subject -matter of insurance will be the physical structure like , house, ship,machinery, potential liability, motor vehicle etc. Therefore it is th3 financial interest of the owner in these properties that amouns to insurable interest. It is this financial interest that is known as the subject matter of the contract.
Insurable interest can therefore be difined as the legal right to insure arising out of a financial relationship, recognized at law as existing between the insured and the subject matter of insurance.
