Surrender Value
We know that non-payment of any premium at any time involves cancellation of the contract of insurance before Insurance Act-1938.
In section 113 of the insurance act provides that a life insurance policy will not lapse for non-payment of premiums if certain conditions are fulfilled.
It provides that surrender value will be acquired if premiums have been paid for at least two years or to the extent of one-tenth(1/10) of the total number stipulated for in the policy, provided that such one-tenth exceeds one full year’s premium.
Suppose, X takes out an endowment policy for 15 years for Tk 15,000 and the premium payable is Tk 1,200 per year. He pays premium for three years and then stop.
The premium paid is (Tk 1,200 * 3)=Tk 3,600. The premium payable is (Tk1,200 * 15)=Tk 18,000. The ratio between the two is Tk 3,600/Tk18,000=1/5. The surrender value of the policy is [Tk 1/5th of Tk 15,000 ]= Tk 3,000
Assignment of Life Policies
In an old English case, Ashely Vs. Ashely, 1829, it was observed that life insurance policies are marketable commodities which can be validly assigned, with or without consideration, to persons who have no interest in the life insured.
The assign ability of life insurance policies is accepted in modern times and permitted by law.
Nomination by the policy-holder
The nominee is the person to whom the money is to be paid if the policy-holder died before the maturity of the contract.
Rules regarding the nomination:
i)The nomination may be incorporated in the text of the policy or be an endorsement on the policy
ii)If the nominee dies before the policy matures the insurer shall pay the money to the policy-holder or his heirs or legal representatives.
A nominee is only an agent to receive the policy money. The money remains a part of the estate of the assured and is distributable among his heirs.
But if it is appeared from the language used in the nomination that the assured intended to benefit the nominee, he is entitled to the money hot the heirs.
Effects of suicide
A life insurance policy may contain a clause providing that no payment will be made in case the assured commits suicide.
Where there is no clause in the policy relating to suicide, it has been held in English cases that the policy become bad upon suicide and no money is payable.
- Horn’s case, 1861.
Marine Insurance
A contract of marine insurance is an agreement whereby the insurer undertakes to indemnify the assured, in the manner and to the extent thereby agreed, against marine losses, that is to say, losses incidental to marine adventure
Insurable Property:
For the purposes of the Marine Insurance Act, insurable property means any ship, goods, or other movables which are exposed to marine perils. Sec. 2(c).
Maritime Perils
The terms means the perils consequent on, the navigation of the sea, that is to say, perils of the sea, fire, war perils, pirates, rovers, thrives, captures, seizures, jettison, barratry, and other perils.
The Lloyd’s Policy
During the 18th and the 19th century marine insurance business in Great Britain was mostly done by an association of underwriters known as the Lloyd’s of London.
From 1779 the members of the Lloyd’s started using printed policy forms in which the terms of the contract of insurance were incorporated.
At present marine insurance is undertaken not only by the Lloyd’s underwriters but also by many insurance companies.
Fire Insurance
Fire insurance means insurance against any loss caused by fire.
Section 2(6A) of the insurance act defines fire insurance as follows: “ Fire insurance business means the business of effecting, otherwise than incidentally to some other class of business, contracts of insurance against loss by or accidental to fire or other occurrence customarily included among the risks insured against in fire insurance policies
No comments:
Post a Comment