Law of Insurance Case Study Example | Topics and Well Written Essays - 2000 words

Law of Insurance - Case Study Example, which is paramount to analysing the first part of the problem.4 The grammatical circumstance of Lucena v Crauford 1806, the court held that the fact that the holdant had a factual loss was not enough to prove that he had an insurable interest in the property.5 The decision in this case may apply to our current facts scenario as Andy and Bhavinda would not brace an insurable interest in the stamps since they do not belong to them although they may match a factual loss of owing their friend the value of the stamps through the principles of bailment.6 Another leading case in this area is the case of Macura v Northern Assurance Co. Ltd. 1925. In that case, Mr. Macura had taken knocked out(p) an damages policy in his own name on timber which legally belonged to the company, although the company was owned and operated by him after the timber had been destroyed by a fire and Mr. Macura tried to make a claim under his policy, the court held that he did not have an insurable interest and only the company would have an insurable interest in that particular timber.7 This comes from the principle that a legal company is a fork legal person from its members.8 The only way that the stamps would have been covered by the policy is if in that location had been planning for third-party losses however, this is not stated within this particular facts scenario. The problem here is that UDO is refusing to pay anything, citing that the couple were importantly under-insured. They are basically citing that Andy and Bhavinda misrepresented the amount of goods that they were in possession of to be covered. In effect, the test exposit in the case of Pan Atlantic Insurance Co. Ltd v Pine Top Insurance Co. Ltd. 1995 should be engaged by the court to determine whether or not s.2(2) of the Misrepresentation act as 1967 should apply.9 The test determines that the considerateness may be material even if it does not induce a prudent underwrite rs decision to induce it or not and at what premium however, if it is determined that it did not induce the contract, the insurance company cannot use it to avoid the contract.10 By applying the test to this case, the fact that Andy and Bhavinda had only indicated that the value of the contents was only 10,000 would at to the lowest degree have some effect on premiums charged, and therefore would most likely be determined by the court as a misrepresentation of fact as covered under s.2(2) of the Misrepresentation Act 1967, for which the remedy is rescission and the insurer would be able to rescind the contract and refuse paying out any claims, as they did in fact do as explained in our facts scenario. However, Andy may be enterprise to rely on the case of Joel v Law Union and Crown Insurance Co. 1903, in which it was held that there is no need to disclose what you do not know however, it was shown in the facts that he did know almost Bhavinda storing the stamps, he had in fact j ust forgotten at the time he was purchasing his insurance.11 Since the fact that only 10,000 was falsely provided