Should insurable interest be a requirement for the validity of a insurance contract in Namibia

Abstract

Abstract provided by author

The requirement of Insurable Interest in Life Assurance has its origin in English Law since the promulgation in that country of the Life Assurance Act 1774 whose primary objective was to prevent wagering and eradicate the temptation of the insured to kill the insured life. There are seemingly two different approaches to the question of insurable interest in our law, namely that a person who actually effects the insurance has to have an insurable interest in the life insured and an insurable interest is not required in principle

The current approach is that an insurable interest is not required in principle. That there is no justification for the application in our law of the principles of English insurance law, including the theory of insurable interest, and that there is no reason why the contract of insurance should not be evaluated according to the principles of the Roman-Dutch law. Further that the concept of insurable interest has resulted in uncertainty and that it should be regarded merely as a guideline and not as a fixed principle. The only purpose the concept of insurable interest may serve is to distinguish between enforceable insurance contracts and non-enforceable insurance contracts where the contract could be regarded as a wager. Therefore, in any investigation the predominant object should be to determine whether the contract in question is a wager, and not whether or not the insured has an insurable interest. In this investigation the fact that the insured did not have an insurable interest may be taken into account, but this does not mean that if the insured did not have an insurable interest the contract would automatically amount to a wager. This investigation must be coupled with having to establish the intention of the parties when they concluded the contract

This paper has taken cognisance of chief purpose for legislating on the doctrine of insurable interest which is to prevent wagering and eradicate the temptation of the in developments in other jurisdiction regarding the doctrine of insurable interest, the conclusion will be made that the insurable interest should not expressly be made a necessary requirement for the validity of a life insurance contract in Namibia

I making the conclusion intended it will also be highlighted some major but rectifiable deficiencies such as its scope, definition, timing, and practical valuation which could further support the point that the requirement of insurable should not be made a necessary requirement for the validity of a life insurance contract in Namibia.