Table of Statutes
Gambling Act 2005
Gaming Act 1845
Life Assurance Act 1774
Marine Insurance Act 1788
Marine Insurance Act 1906
Marine Insurance (Gambling Policies) Act 1909
Table of Cases
Cowan V Jeffrey Associates 1998 SCLR 619
Feasey V Sun Life Assurance Co of Canada 2003 EWCA Civ 885
5 Griffiths V Flemming 1909 1KB 805
Inglis V Stock 1885 10 Apps Cas 263
MacAura V Northern Assurance Co Ltd 1925 AC 619 HL
Mitchell v Scottish Eagle Insurance Co Limited 1997 S.L.T. 793
4 Prudential Insurance V IRC 1904 2 KB 658
Scottish Amicable Heritable Securities V
Northern Assurance Co 1883 11 R 287
5 Sloans Dairies V Glasgow Corp 1977 Scot CS CSIH_2
Wight V Brown 1845 11D 459
The concept of insurable interest and the alleged need under Scots law for the requirement of insurable interest by the insured in an insurance policy, have recently come under scrutiny. Why is this, and what should be done about the problems arising from the requirement for insurable interest? How realistic are the proposals for reform?
The question makes reference to issues with the concept of insurable interest, how we managed to get to this point, lessons to be learned, any solutions to the issues, although nothing seems new that there are issues with the concept of insurable interest, the definition Mitchell v Scottish Eagle Insurance Co Limited, and the call to resolve the various problems arising, discussed in the 2008 issues paper. A previous Joint Scoping Paper issued in 2006 by the Law Commission (LC) and the Scottish Law Commission (SLC) was a return to the area of Insurance Contract Law, in response to a report from the BILA in 2002. The Scoping Paper predates the Gambling Act, but at the outset, highlights issues and prospect of reform on various components of Insurance Contracts, including insurable interest. In Scots Law, insurable interest is embedded into common law, but even at the early stage of reform, the Scoping Paper highlights issues with clarity regarding statute such as Marine Insurance Act requiring that names are stated of interested parties in terms of “goods, merchandise, effects or other property” then the Marine Insurance Act repealing the marine element causing additional confusion.
The LC and SLC January 2008 ‘Issues Paper 4 Insurable Interest’ will be considered here, considering an invitation for response from interested parties and stake holders, although another paper was due 2009 and by the time of writing in 2011, no new papers have been tabled. From statute that was passed in the eighteenth century, as relationships have changed, businesses have changed and evolved, the common law has moved on causing unclear situations and potentially unfair outcomes where for example a person makes a claim is not on a pecuniary interest founded on law, Griffiths V Flemming, such as cohabitee in a relationship where in law there is not sufficient natural affection, Wight V Brown, although could have been in place for twenty plus years, in essence will fail as there is not sufficient insurable interest. There have been many instances of this type, also where there is error with a person believing they have insurable interest and investing everything they have in a business, for a court to rule against them as the claim and policy is in their own name and not the business name Cowan V Jeffrey Associates, also Sloans Dairies V Glasgow Corp. As well as this situation being potentially illegal, the question could be asked of the insurance company who would probably have known of the issue with the insurable interest. The latest reason on the returning to the reform issue within the 2008 paper is the disputed impact that the Gambling Act will have on insurable interest, allegedly overwriting the Gaming Act 1845 s.18, which states that a...
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