Insurable Interest

Übersicht

You may insure your own car, but you may not insure your neighbour's. You may insure your own life for any amount, yet you may insure a stranger's for nothing at all. The rule that draws this line is insurable interest, and it is what separates a genuine insurance contract from a bet. Without it, a policy is not merely unpaid at claim time: in law it never existed.

This lesson explains what insurable interest is, the essential features the law looks for before it recognises the interest, and the one point examiners test most: the exact moment the interest must be present, which differs for life, for marine and for fire and motor cover. You will apply the rule to decide who may validly insure what, and see why a policy taken out without it is simply void.

Ziele

  1. Define insurable interest and explain why the law requires it
  2. State the essential features that must be present before insurable interest exists
  3. Explain when insurable interest must attach in life, marine and property insurance
  4. Apply insurable interest to decide whether a named person may validly insure a stated subject matter
  5. Explain the consequence of effecting a policy without insurable interest

Lektionshinweis

Suppose you could walk into an office and insure the shop across the road, a shop you do not own and have never set foot in, for ₦20,000,000. If it burned down you would collect a fortune; if it stood, you would lose only your premium. That is not insurance. It is a wager on somebody else's misfortune, and it hands you a reason to wish the shop harm. The law shuts this door with a single requirement: before anyone may insure a thing, they must stand to lose financially if that thing is damaged, destroyed or, in the case of a life, ended. That financial stake is insurable interest, and it is the first question a claims officer asks.

Unterrichtsbewertung

Herzlichen Glückwunsch zum Abschluss der Lektion über Insurable Interest. Jetzt, da Sie die wichtigsten Konzepte und Ideen erkundet haben,

Sie werden auf eine Mischung verschiedener Fragetypen stoßen, darunter Multiple-Choice-Fragen, Kurzantwortfragen und Aufsatzfragen. Jede Frage ist sorgfältig ausgearbeitet, um verschiedene Aspekte Ihres Wissens und Ihrer kritischen Denkfähigkeiten zu bewerten.

Nutzen Sie diesen Bewertungsteil als Gelegenheit, Ihr Verständnis des Themas zu festigen und Bereiche zu identifizieren, in denen Sie möglicherweise zusätzlichen Lernbedarf haben.

  1. Insurable interest is best described as: A. The premium a person pays for a policy B. A legally recognised financial stake a person has in the thing insured C. The profit an insurer makes on a contract D. The affection a person feels for another Answer: B
  2. In which class of insurance must insurable interest exist only at the time of loss? A. Life assurance B. Fire insurance C. Marine insurance D. Motor insurance Answer: C
  3. A creditor lends 1,000,000 naira at an agreed interest of 200,000 naira. The maximum insurable interest the creditor has in the debtor's life is: A. 1,000,000 naira B. 200,000 naira C. 1,200,000 naira D. 800,000 naira Answer: C
  4. A policy effected without any insurable interest is: A. Valid but non-transferable B. Void and treated as a wager C. Payable only in part D. Converted into a life policy Answer: B
  5. Which of the following persons does NOT have an insurable interest? A. A husband in the life of his wife B. A dry cleaner in the clothes left in his custody C. A man in the new car of a colleague he admires D. A joint owner in the jointly owned house Answer: C

Empfohlene Bücher

Principles of Risk Management and Insurance
Principles of Risk Management and Insurance
Untertitel: Thirteenth edition
Verleger: Pearson
Jahr: 2016
ISBN: 978-0-13-408257-8
Beschreibung: The standard introduction to risk and insurance, covering risk management, insurer operations and the main lines of life, health, property and liability cover.
Fundamentals of Risk and Insurance
Fundamentals of Risk and Insurance
Untertitel: Tenth edition
Verleger: Wiley
Jahr: 2008
ISBN: 978-0-470-08753-4
Beschreibung: A clear account of the nature of risk and the economics of insurance, written for beginning students across life, health, property and liability insurance.
Fundamentals of Insurance
Fundamentals of Insurance
Untertitel: Second edition
Verleger: Himalaya Publishing House
Jahr: 2017
ISBN: 978-93-5097-079-9
Beschreibung: An accessible treatment of insurance in four parts: the basics of risk, insurance management, life insurance and non-life insurance.

Frühere Fragen

Fragen Sie sich, wie frühere Prüfungsfragen zu diesem Thema aussehen? Hier sind n Fragen zu Insurable Interest aus den vergangenen Jahren.

WAEC SSCE - Insurance - 2015

Frage 1 Bericht

List and explain five principles of insurance.

Antwort anzeigen