{"id":352579,"date":"2017-06-02T17:22:37","date_gmt":"2017-06-02T22:22:37","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/consumer\/insurance\/do-i-have-an-insurable-interest.html"},"modified":"2024-03-30T23:49:10","modified_gmt":"2024-03-31T04:49:10","slug":"do-i-have-an-insurable-interest","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/consumer\/insurance\/do-i-have-an-insurable-interest.html","title":{"rendered":"Do I Have an Insurable Interest?"},"content":{"rendered":"\n
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Do I Have an Insurable Interest?<\/h1>\n
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\n By FindLaw Staff<\/a> | Legally reviewed by Melissa Bender, Esq.<\/a>\n | Last updated\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n

With so many types of insurance<\/a>, you might wonder if there are limits. You can insure your pet, boat, crops, and life. You can seek insurance coverage<\/a> as long as you have an insurable interest.<\/p>\r\n

Read on to learn more about insurable interests and how they affect the types of insurance policies you can purchase.<\/p>\r\n

What Is an Insurable Interest?<\/h2>\r\n

You must have an insurable interest<\/a> to buy insurance. An insurable interest can take many forms. You have an insurable interest in a person or thing if you would suffer a direct financial loss upon the destruction of the person or property insured. A person, event, action, or item can have an insurable interest if its loss or damage results in a financial burden. There are many examples of insurable interests.<\/p>\r\n

Insurable Interest in Life Insurance<\/h3>\r\n

A typical example of insurable interest involves life insurance. Life insurance requires an insurable interest in another person’s life. That person’s death must cause you financial hardship. Or, you could have an insurable interest if you have a financial stake in another’s life. If you have a financial interest in a person or property, you could have an insurable interest.<\/p>\r\n

In other words, you have an insurable interest if you benefit from the continued well-being and existence of the property or person. Similarly, you can’t buy a life insurance policy<\/a> on your distant third cousin if their death wouldn’t directly affect your finances. A life insurance contract with your cousin as the person insured does not likely represent an insurable interest.<\/p>\r\n

On the other hand, you have an insurable interest in your spouse as the insured person if you rely on your partner for finances. A life insurance company could issue a life insurance policy following underwriting. In this case, a death benefit death would help with financial security for surviving family members.<\/p>\r\n

Likewise, you have an insurable interest in your own life. You can buy life insurance on your own life. Anyone who will suffer a financial loss when a person dies would have an insurable interest. They may be the following:<\/p>\r\n