The Application Of The Principle Of Insurable Interest In The Life Insurance Contract

With the drastic enhancement of the awareness of insurance, insurance, especially life insurance, has come gradually into the by millions of households. Consequently, there are the increasing numbers of insurance disputes, most of which are associated with insurable interest. Insurable interest, the soul of the insurance contract, plays an important role in the insurance contract. Thus, the further study of the insurable interest is essential for the innovation and the improvement of the entire Insurance Act. Although many studies in the field of insurable interest, most of whose focuses are on the property insurable interest, have been carried out, few studies are done in the area of life insurable interest and hence the views on it are divergent. In the period of the amendment of "China's Insurance Act", the discussion of the life insurable interest is particularly urgent.Therefore, based on some specific cases, this paper analyzes the necessity of the application of insurable interest in personal insurable interest from both theoretical and practical angle, with the aim of pointing out the defects in China's personal insurable interests system related aspects of the system defects and thus put forward legal suggestions towards it by investigating the relevant problems in the application of the principle of the personal insurable interests in China.This article consists of five parts.Part I: general study of insurable interest. First, this article looks back the history of insurable interest; life insurable interest originated in marine transport, and ascertains ultimately in "Life Assurance Act 1774" in the United Kingdom. On this basis, the article gives insurable interest a definition. Scholars in insurance generally believed that the insurer have insurable interest for the relationship of their own lives and bodies, of family affiliation, of trust and of interests with others. Then, the article gives the nature of life insurable interest a qualitative analysis. The economical interest theory holds that the insurable interest is a kind of economic interest in essence. The relation theory holds that insurable interest is a kind of interested relation in essence and the article agree the economical interest theory. Finally, we discuss the function of the principle of life insurable interest. The function of the principle of insurable interest in the life insurance more focused on the prohibition of gambling and to prevent moral risk.Part II: the necessity of the principle of life insurable interest's application. In this part, the paper first holds that it is a fatal flaw in the principle of approval: on the one hand, it results the insured fully bear the risk as their own wrong judgment; on the other hand, it also aggrandizes the risk of the insured's life. Then, the thesis, analyzing the principle of life insurable interest, argues that the demand of this principle is necessary but not by accident, as the result of preventing risks, the function of human morality and the role of public policies. What's more, on the basis of two principles, the author claims that the principle of life insurable interest can also be applied to life assurance for three reasons: firstly, the characteristics of the principle of life insurable interest should be used in life assurance; secondly, the interest relationship between the insurer and the insured is the prerequisite of the principle of approval in essence; thirdly, the principle of approval does not fit for our country's condition in insurance practice.Part III: the analysis of specific application of the principle of life insurable interest. In this part, the author elaborates this principle's application particularly. As to its effect on subject, compared with other countries' legislation and scholars' opinions, the thesis holds that the insurer and the beneficiary have their insurable interest in insurable object in life insurance contract. As to its effect on time, analyzing the specific cases the author argues that the life insurable interest only exists when the contract begins. The application scope of insurable interest can be divided into two categories: the first is the person who has family ties with the insured; the second is the person who has the business relationship with the insured.Part IV: the relevant issues of the application of the principle of life insurable interest. This part elaborates the relevant issues of life insurable interest in practice, firstly with the determination of telling obligation and checking obligation in insurable interest. The thesis claims that the insurer and the insured have the obligation of telling the existence of insurable interest, the insurer has the obligation of checking the insurable interest whether exists or not. Secondly, the transfer of interest of insurance contract in life insurance contract is also elaborated. Analyzing the affirmative theory and negative theory, the paper holds that it is surely exists the demand of transferring the contract in present because of the investment and savings quality of that contract. Thus, transferring this interest freely should be allowed. Thirdly, addressing the legal result of lacking life insurable interest, the author claims that even though the effect of contract element of insurable interest is in legation, we should not only focus on the invalidation of lacking insurable interest contract, and should pay more attention to balance the right and obligation on the basis of honest maximization of insurance contract in juridical practice. Of course, the violation of law and public moral are excepted.Part V: the suggestion of the principle of life insurable interest in legation. The author firstly illustrates the problems of life insurable interest in juridical practice. On the basis of the whole paper, the author puts forward the following legislative proposals of "Insurance Act"1. Delete "Insurance Law" article 53, paragraph 2.2. Enlarge the scope of insurable interest subject.3. Regulate the time effect of insurable interest clearly.