Insurance law's hapless busybody: a case against the insurable interest requirement.

From: The Yale Law Journal | Date: December 1, 2007| Author: | Copyright information

For centuries, the law has prevented people from purchasing insurance on the life or property of strangers because such insurance contracts would give policyholders incentives to end the life or destroy the property in order to collect the insurance payout. The law thus requires that policyholders have an "insurable interest" in the person or property they insure, and contracts lacking such an "insurable interest" are invalidated by courts as against public policy. This Note presents an economic analysis of the insurable interest requirement, and argues that the doctrine creates perverse ...

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