Now suppose you own a warehouse in an industrial district. This year you’ve installed the latest sprinkler and other fire remediation measures. You’re proud of the prevention steps you’ve taken, especially when you look at the neighboring warehouse where the owner has installed the bare minimum to comply with fire department regulations. You decide to call your insurance agent and ask if you can take out fire insurance on the neighboring warehouse. Your insurance agent is sympathetic to having a neighbor who doesn’t seem to care as much as you about fire safety, but he tells you he can’t sell you such insurance, and he doesn’t think any ethical agent will. Why not? What principle of insurance law is involved?
The principle of insurable interests is involved here, because the insurance can be purchased for the insurable interests only. The warehouse owner, having the ownership of the warehouse has a valid insurable interest in his property, and is eligible to take insurance to get compensated for the damages caused to it. However, he does not have insurable interest in someone else's property because having insurance for someone else's property would invoke an invalid interest of causing damage to the other person's property ( for which the insurer would be eligible to claim damages in case of harm to the other property) which is illegal. This is the reason why one can not insure someone else's property.
Now suppose you own a warehouse in an industrial district. This year you’ve installed the latest...
Please read the article and answer about questions. You and the Law Business and law are inseparable. For B-Money, the two predictably merged when he was negotiat- ing a deal for his tracks. At other times, the merger is unpredictable, like when your business faces an unexpected auto accident, product recall, or government regulation change. In either type of situation, when business owners know the law, they can better protect themselves and sometimes even avoid the problems completely. This chapter...