to pay to the assured, or to the person for whose benefit the policy is taken, the assured sum of money, on the happening of a specified event contingent on the human life or at the expiry of a certain period. This insurance provides protection to the family at premature death of an individual or gives adequate amount at an old age when earning capacities are reduced. The insurance is not only a protection but is a sort of investment because a certain sum is returnable to the insured at the time of death or at the expiry of a certain period. The main elements of a life insurance contract are: (i) The life insurance contract must have all the essentials of a valid contract.
(ii) The contract of life insurance is a contract of utmost good faith. (iii) In life insurance, the insured must have insurable interest in the life assured. (iv) Life insurance contract is not a contract of indemnity. Types of life insurance policies: People have different requirements and therefore they would like a policy to fulfill all their needs.
The needs of people for life insurance can be family needs, children’s needs, old age and special needs. To meet the needs of people the insurer’s have developed different types of products such as Whole Life Assurance, Endowment type plans, combination of Whole Life and Endowment type plans, Children’s Assurance plans and Annuity plans. Fire insurance: Fire insurance is a contract whereby the insurer, in consideration of the premium paid, undertakes to make good any loss or damage caused by a fire during a specified period upto the amount specified in the policy. The main elements of a fire insurance contract are: (i) In fire insurance, the insured must have insurable interest in the subject matter of the insurance.
(ii) Similar to the life insurance contract, the contract of fire insurance is a contract of utmost good faith i.e uberrimae fidei. (iii) The contract of fire insurance is a contract of strict indemnity. (iv) The insurer is liable to compensate only when fire is the proximate cause