Element of fire insurance contract

(1). Feature of general Contract:

All the features of general contract are also applicable to the fire insurance contract.

(a) Proposal:

The proposal for fire insurance can be made either verbally or in writing. The proposes gives the necessary description of the property to be insured. In practices the printed proposal from is used for the purpose. Introduction, type of properties, value of properties, construction, occupation, etc. are the various

information which are required by the insurer. The answers to these questions must be completely correct. The assured must disclose all the material facts & should observe utmost good faith. The description of the subject matter of insurance is the basis of the contract for assessing the risk & fixing the premium.

(b) Acceptance:

On receipt of the proposal form, the insurer will assess the risk. Sometimes, when the contents & subject-matters are not of very high amount, the insurer may accept on the basis of proposal forms only. When the subject-matters is of larger magnitude & where the hazard involved is of a variable or unknown nature, the insurer may send his surveyor to survey the property. The surveyors being expert in the field of insurance evaluation will consider the proposal in the light of this report. The unknown proposes are required to submit an evidence of respectability. The insured is required to submit a certificate from some known & respectable person about honesty & integrity. AS soon as the proposal is accepted, the assured is informed about the decision.

(c) Commencement of risk:

The risk commences as soon as the contract is completed provided there is no specific time for the purpose. As soon as the proposal is accepted, risk will commence irrespective of the fact that no policy was issued & no premium was paid. Where risks are unknown & tremendous, the payment of premium will be the basis of the completion of the contract. The risk will commence only when the premium has been paid & not before that; when the policy has been issued, payment of premium will not be the basis of commencement of risk.

(2). Insurable Interest.

(3). Principle of good faith.

(4). Doctrine of subrogation.

(5). Warranties.

(6). Proximate cause.