The Beneficiaries

With China's accession to the WTO, the protection of the insurance industry is about to conclude.We will face more severe competition in the market. Although we have made a remarkable achievements in the past 20 years, we should also recognize that we are facing rapidly rising trend of insurance disputes. Some domestic insurance company's management were non-standard, lacking credibility and lead to few trust that people have. In a world-renowned consultancy McKinsey's survey report which published in 2005, China's life insurance surrender was 10% in 2004, five times than United States's. The hardship of our insurance industry is obvious. Investigate its reason, there are so much relationship with the defection and non- reasonable in the present insurance law of our country. The question of beneficiary is one of the most serious problems. Theory cornect with practice, combining insurance with legal, absorbing and learning from foreign advanced legislation and judicial practice, taking the western economics analysis, I want to explore this question with three different levels—including what, why and how.This paper is divided into five parts. The first part include the concept and types of beneficiaries, and it's legal status.(A) On the basis of different scholars' analysis of the concept, the author belived that the beneficiary of the insurance, designated by the insured and after it, is entitled to claim for the insurance benefits after the accident. From this definition, the author stressed the following points: First, the designation of beneficiaries should be insured, when insured and the applicant were not one person, the designation must be approved by insured. Second, the beneficiary is entitled to claim for the insurance benefits on the premise of accidents. Third, only when the insured give up, not transfer or discharge, the beneficiaries had right for insurance benefits. Fourth, the author break the current view that beneficiaries exist only in life insurance,the beneficiary may exist in the entire insurance contracts.(B) In order to analysis this article, the author divided the beneficiaries into : (1) designated beneficiaries and statutory beneficiaries;(2) the original beneficiary, beneficiaries and heirs successor; (3) modify and inalterable beneficiaries; (4) survive and the death beneficiaries (5) personal and property beneficiaries. (C)As the relations people to the insurance contract, the most prominent feature of the law is usually enjoy contractual rights and rarely to bear the main duties of the contract.The second part about the eligibility and the scope of beneficiary. Having an insurable interest, the proper beneficiary is set up. Natural person, legal person and fatus can be beneficiary. It not only exists in the life insurance ,but also in property insurance. (A) The author believed that the validity of insurance intrest apply to applicant, insured and beneficiaries equally. But it lay in the different stage when the insurance contract is signed. Beneficiaries, which should become the main object to guard against moral hazard, should have an insurance interest. (B) In the property insurance contract,the action which the third man was designated to be beneficiary did not breached the fundamental of the Civil law. Such claims increased the guarantee of obligation. The China Insurance Regulatory Commission's interpretation on the guarantee insurance had also indirectly acknowledged the existence of the beneficiaries. So, it is necessory and reasonable to design beneficiary in following property insurance contracts: (1) designate creditors as beneficiaries; (2) insured without successors.The third part about the designating and changing of beneficiaries: (A) The author believes that the right of designated beneficiaries belong to the insured, applicant's designated right came from the insured's authority, and insured should notify the applicant at designating.The designation of beneficiaries should be clear. When beneficiaries were designed abstractly, the person who has the special relationship to the insured should be regarded as beneficiaries.When the contract has not beneficiaries or designated as "legal", the successor of the insured shall be to enjoy the beneficial right on the base of protect the rights of the insured and beneficiaries. (B) The right to change beneficiaries should also belong to the insured, and applicant should be notified by insured in order to decide whether to pay premiums continuously. Meanwhile, changing beneficiary is a unilateral and formal legal action, the author regard it as forming right. So long as the insured notice the insurers by written notification,the change should take effect even no the insurer's endorsement. In addition, I believed that the law should also recognize the legal effect of wills modify in special circumstances and inalterable beneficiaries.The fourth about the rights and obligations of beneficiary: (A)Before the occurrence of the insured event, beneficiary's beneficial right belong to expect staturs, and it's property or the right to claim for the insured amount after the insured event.In addition, beneficiaries should also have the right to know.(B) After the occurrence of the insured event, the insured or beneficiary are entitled to claim for the insured amount. The legitimate rights of the beneficiaries should be protected : (l)General designation or have no designation, I think it is the heirs of insured who are entitled to claim for the insured amount. (2)If a beneficiary intentionally caused the death or disability of the insured, or attempted to cause the death of the insured, when there are other beneficiaries, the insurers can not stand exemption to other beneficiaries.(3) The death or disability of the insured results from his intentional committing a crime, the insured can not get rid of obligation of course. Considering the harmful of criminal acts to society and the criminal liability of the perpetrator, and the causal relationship between intention- al criminal acts to his own disability or death , we can judge the insurer's exemption. Correspondingly, with the rapid development of life insurance in China, increasing the restrictions on the terms of Life insurers to avoid the phenomenon of maliciously evade the debt will be equally important.(C) Any loss of beneficiary right cases, in my view include the following:(l) Beneficiary intentionally caused the death or disability of the insured , or attempted to cause the death of insured;(2) the beneficiary dies before the insured or surrender his rights; (3) termination of a contract;(4) Any loss of the insurable interest.(D) The main obligations of beneficiaries is timely notice and provide evidence.Moreover, thay have an indirect obligation , not to fabricate the occurrence of an insured event on purpose.Part V about the improvement of the beneficial system which surplied by the author: (1) Using a broad definition of the beneficiary, meanwhile, having stringent restrictions on the eligible beneficiaries, I believed the beneficiaries should have insurable interest. (2)Detailing the breakdown of beneficiaries, especially for survival beneficiary, inalterable beneficiary, statutory beneficiary and the unnatural person beneficiary, so that we can make it more perfect.(3)The insured should inform the applicant when designating the beneficiary, the designation should be clear to avoid possible legal disputes.(4)The insured should inform the insurer and the applicant with written form when changing the beneficiary. We should recognize the validity of the changing beneficiary with testament in special circumstances. The right of changing is the right of form.(5) The beneficiary has the right of know .(6)Strengthen the protection to beneficiary right. "No defense" is the better way to protect the legitimate rights of the insured and other beneficiaries. The insurer shall not have no obligation where death or disability of the insured results from his intentional committing a crime of course, insurers can not defense.(7)The beneficial right shall be restricted appropriatly to prevent the applicant to evade debts maliciously.