A life insurance policy promises that the insurer of the policy payto a certain sum ofmoney upon the death of the insured or any other specified contingency happens. it is acontract within the meaning of the Contract Law of India, 1872. A contract is an agreement between two or more parties to do or not do, in order to create a legally binding relationship. A simple contract must have the following essential
. offer and acceptance
. cosideration
. capacity to contract
. consensus "ad idem"
. Legality of object or purpose
. performance capacity
. intention to create a legal relationship
Insurance is a contract between the insurer and the policyholder. The policyholder may be different from whose life is insured, as discussed below. Insurance is a special type of contract. Apart from usual essentials of a valid contarct, insurance contracts aresubject to two additional principles.
* PRINCIPLE OF GOOD FAITH
* Principle of insurable interest
. offer and acceptance
. cosideration
. capacity to contract
. consensus "ad idem"
. Legality of object or purpose
. performance capacity
. intention to create a legal relationship
Insurance is a contract between the insurer and the policyholder. The policyholder may be different from whose life is insured, as discussed below. Insurance is a special type of contract. Apart from usual essentials of a valid contarct, insurance contracts aresubject to two additional principles.
* PRINCIPLE OF GOOD FAITH
* Principle of insurable interest
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