Home >> British Encyclopedia >> Inflammation to Language 1 >> Insurance

Insurance

insured, policy, called, loss and ships

INSURANCE, marine. Insurance is a contract of indemnity, whereby the party, in consideration of a stipulated sum, un dertakes to indemnify the other against certain specific perils or risks to which he is exposed, or against the occurrence of such events. The party who takes on himself the risk, is called the insurer ; the party protected by the insurance is called the insured ; the sum paid to the insurer, as the price of this risk, is called the premium ; and the written instrument, in which the contract is set forth, and re duced into form, is called a policy of in surance.

Marine insurance is made for the pro tection of persons having an interest in ships, or goods on board, from the loss or damage which may happen from the pe rils of the sea, during a certain voyage, or for a fixed period of time.

In this country all persons, whether British subjects or aliens, may in general be insured ; the only exception is in the case of an alien enemy. He cannot main tain an action on a policy on goods, though they were shipped before the war commenced ; nor can an agent of such insured maintain the action, though he be a creditor of the insured for more than the sum insured.

The statute 6 George I. c. 18, autho rized the king to grant charters to two distinct companies or corporations, called the Royal Exchange Assurance, and London Assurance ; for the insurance of ships, goods, and merchandises, at sea, or going to sea, and for lending money on bottomry. They are invested with all the powers usually granted to corpora tions, and the privilege of purchasing lands to the amount of one thousand pounds per annum each, to provide a suf ficient capital to insure all demands on their policies. All other companies are

restrained from insuring ships and goods at sea, or lending money on bottomry And all policies made by any other cor poration, and any copartnerships, shall be void, and the sums underwritten for feited, and all bottomry bonds deemed usurious : but the right of individual in surers continues as before the act. Con tracts made in derogation of the rights of the insurance companies are illegal and void.

Ships, freight, goods, and merchan dises, &c. are the proper subjects of ma rine insurance, and there are certain arti cles which, from motives of public policy, cannot be legally insured in this country, and others which can only he insured un der particular restrictions.

Insurance being a contract of indem nity from loss or damage, arising upon an uncertain event, there cannot be an indemnity without a loss, nor a loss with out an interest ; a policy, therefore, with out interest, is not an insurance, but a mere wager. Different persons, having each a qualified property in goods, may insure them to the full value. A reasona ble expectation of profit, on a well founded expectation of a future interest in the thing insured, is an insurable interest.

Wager policy. This is usually conceiv ed in the terms, interest or no interest, or, without further proof of interest than the policy, to preclude all inquiry into the interest of the insured, and as a consequence of the insured's having no interest in the pretended subject of the policy, it follows, that the insurer cannot be liable for any partial loss.