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factual expectancy test and "legal interest test" are the two major concepts of insurable interest.
interest of insurable it is occur when an insured person derives a financial or other kind of benefit from the continuous existence of the insured object (or in the context of living persons, their continued survival). A person has an insurable interest in something when loss-of or damage-to that thing would cause the person to suffer a financial loss or other kind of loss.
Typically, insurable interest is established by ownership, possession, or direct relationship. For example, people have insurable interests in their own homes and vehicles, but not in their neighbors' homes and vehicles, and certainly not those of strangers.
Insurable interest exists when an insured person derives a financial or other kind of benefit from the continuous existence of the insured object (or in the context of living persons, their continued survival). A person has an insurable interest in something when loss-of or damage-to that thing would cause the person to suffer a financial loss or other kind of loss.
There should be a legal relationship with the object for which you are opting for an insurance cover.
Can anyone opt insurance on the life of the wife of his neighbour ? Certainly not. He can take life insurance policy only on the life of his wife/her husband. Same goes for general insurance also. This relationship on which the insurance coverage stands is known as Insurable interest, and this principle is applicable to both life and general branch.
The code insurable interest refer to a monetary interest and the insured should has real interest in avoiding risks , insurance which misses this interest void and no value
For an insurance contract to be valid the insured must have an actual insurable interest at the time of contract is excecuted and insurable interest must exist at the time of loss event occurs
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Insurable interest means particular object proposed for insuarnce must be in the ownership/relationship/possion of proposer beacuse only proposer or any person authorised by proposer will be beneficiery of insurable property, so a propser can't insure other's property or belongings.
