Analysis Of The Basic Principles Of Insurance Under The Nigerian Law Of Insurance
Chapter 1
General Introduction
Preface
Due to the high position of ignorance in the Nigerian society, numerous people are ignorant of insurance programs. still, with the enactment of Insurance Decree( 1), the mindfulness of insurance programs was enhanced. therefore, further people took way to ensure their parcels or lives. Unfortunately, still, important as the high chance of them typically end up unfit to have their claims remunerated, either as a result of a breach of one insurance principle or another. These principles are multitudinous and they’re the base upon which insurance contracts are grounded. Failure to cleave to any of the principles may render an insurance contract void. The need to understand as well as having a alternate knowledge of the introductory principles of insurance can not be over emphasized.
These principles of insurance which are i) Insurable interest; ii) Utmost good faith/ Duty of expose; iii) Subrogation; iv) proximate cause; v) Indemnity; vi) ‘ No Premium, No Policy ’, are the bedrock of insurance contract, the absence of any of which the purpose of insurance will be defeated.
The purpose of insurance can not be dubious. This can fluently be seen from the colorful delineations of insurance. Insurance contract has been defined in the case of PRUDENTIAL INSURANCE COMPANY V INLAND REVENUE Manager( 2), as
a contract whereby a person called the ‘ insurer ’ undertakes in return for the consideration called the decoration to pay another person called the ‘ assured ’ a sum of plutocrat or its original on the passing of a specified event
Insurance is an intricate profitable and social device for the running of pitfalls to life and property. It’s social in nature because it represents the colorfulco-operations of colorful individualities for collective benefits by combining together finances to reduce the consequence of analogous threat.
Simply put, insurance is the placing reverse of a person who has suffered a loss in the same position he was before loss passed. It aims to annihilate the consequence of a loss by not allowing the ensured to suffer the consequential loss. still, as before stated, unless one meets the conditions of all the introductory principles of insurance, he’ll be estopped from claiming under an insurance contract.
Background To The Study
Insurance law is reputed for its general principles, and the principles of reprisal is one of them, others are insurable interest, utmost good faith, subrogation, donation and proximate cause. A principle denotes a general guiding rule, which doesn’t include specific directions, which vary according to the subject matter.
The introductory principles applicable to insurance law inflow from the nature of insurance contract as conceived, numerous times agone , by Law merchandisers and taken over by the Common Law. The principles are common to all classes of insurance, both life and nonlife and both marine andnon-marine. By its nature, insurance contract presuppositions that a sum of plutocrat will be paid on the passing of the ensured event by the insurers; still, the event must be uncertain. The query related to whether the event will ever be as in fire or accident insurance or as in life insurance where death is a necessary end to all mortal life, but the time of death is uncertain. In comparison with other areas of the law, there’s no other law, which attracts the number of general principle s with deep- confirmed effect as insurance.
Points And Objects Of Study
The end of this content is to enlighten the general public about this area of insurance, which though feel insignificant yet is the base of the insurance contract. This content thus aims to consider the position of the insurer as well as the ensured. Also, the points and objects of this study is to exclude or at least to minimize similar misconstructions by stating the ‘ rules of the game ’ for the benefit of the parties taking part in the insurance contract or sale.
Focus Of Study
This design focus substantially on the introductory principles of insurance under the Nigerian Law of Insurance, how it affects insurance programs, how this goods can be minimized as well as a determination of when an insured is entitled to claim and when he’s not grounded on these principles.
Compass Of Study
The compass of this study is within the Nigerian Law of Insurance. The areas to be coveredinter-alia include the analysis of the introductory principles of insurance which correspond of
Insurance Interest, Utmost Good Faith, exposure and Offer, form, the Premium Policy, reprisal, Subrogation and Proximate cause, as it relates to the contract of insurance under the Nigerian Law of Insurance.
Methodology
The style to be espoused in this essay will be explanatory and narrative. For this essay to achieve its end, reliance will be placed on secondary sources of information gathered from handbooks, law reports, view of magistrate, judicial opinions, wordbooks and encyclopaedia on the subject matter and of course, the internet. It’s material to mention that numerous papers, journals haven’t been written in this area of law, the many that are available will be well utilised.
Literature Review
Though numerous foreign books didn’t treat the content of this essay in details but one of its generalities insurable interest, utmost Nigerian Authors still, lighten the burden of this work with their diplomatic treatment of the introductory principles of insurance. Important Authors in this regard includeJ.O. Irukwu, on Insurance Law and Practice in Nigeria; Professor Olusegun Yerokun, on Insurance Law in Nigeria and Funmi Adeyemi, on Nigeria Insurance Law.
According toJ.O. Irukwu, the abecedarian principles of Insurance Lawand Practice as applicable to Nigeria are insurable interest, utmost good faith, exposure, reprisal, subrogation and proximate cause. Though Irukwu, on this subject has principles laid down before the now operating Insurance Act 2003 in Nigeria, some of these principles remains in conformation with the insurance Act 2003. To make the work an streamlined are still, Funmi Adeyemi and Professor Olusegun Yerokun’s insurance textbook which contains the prevailing law will inversely be used among other accoutrements . Olusegun Yerokun’s textbook which is Insurance Law in Nigeria provides a comprehensive analysis of insurance law in all its aspects. As a result of the repeal of the Insurance Decree, 1991 and the promulgation of the Insurance Decree, 1997, and the now operating Insurance Act 2003, the contents reflect the changes in law. The introductory principles of insurance according to Yerokun are Insurable Interest, Utmost Good Faith, Indemnity, Subrogation,
Disclosure, Premium and Proximate Beget. There’s also the work ofM.C. Okany on Nigerian Commercial Law, which is of the opinion that contracts of insurance are governed by the general principles of contract but, on account of their special nature, all contracts of insurance are in addition governed by special or abecedarian principles. These principles of insurance according toM. C Okany are Utmost Good Faith, Insurable Interest, Indemnity and Subrogation. The work and donation of these distinguished authors are conceded to be of great value.
There are also foreign authors who have in no small measure distinguished themselves and whose workshop are applicable to this exploration, some of these authors are John Birds on Modern Insurance Law; Opined that the introductory principles of insurance are insurable interest, fraud,Non-Disclosure and Misrepresentation, decorations and Subrogation. He’s of the view the most important and dependable is the insurable interest; There’s also the work of MacGillivray and Parkington on Insurance Law. The General principles of insurance according to them are insurable interest, decoration and subrogation, they noway includenon-disclosure and misrepresentation as John Bird. Raoul Colinvaux on The Law of Insurance, includes reprisal, which makes his none comprehensive than the other two, which is insurable interest,non-disclosure and misrepresentation decoration, reprisal and subrogation and in addition, Hardy Ivamy ‘ General Principles of Insurance Law will also be consulted. All these foreign authors in their books are of the opinion that the introductory principles of Insurance are Insurable Interest,Non-Disclosure, The
Premium, Indemnity and Subrogation.
Also, notable judicial pronouncements of the courts and the opinion of justices are also reckoned upon coupled with reference to colorful legislations on insurance like the Marine Insurance Act, 1961; Insurance Act, 2003.
description OF TERMS
For proper understanding of this design content, there’s need to acquaint ourselves with some introductory insurance languages.
threat In insurance law, the peril or hazard of a loss of the property ensured( 3). In a contract of insurance, the insurer undertakes to cover the ensured from a specified loss and the insurer receives a decoration for running the threat of similar loss. therefore, threat must attach to a policy.
Mitigation of Loss In the event of some mishap to the insured property, the ensured must take all necessary way to alleviate or minimize the loss, just as any prudent person would do in thosecircumstances.However, the insurer can avoid the payment of loss attributable to his negligence, but it must be flashed back that though the ensured is bound to do his stylish for his insurer, If he doesn’t do so. ensure To make sure or secure, to guarantee, as to ensure safety to anyone. It also mean to compensate a person against financial loss from specified threats or possible liability4.
ensured The ensured is the policy- holder who’s entitled to reprisal or financial compensation on the passing of an event ensured against. The ensured is also the person who obtains or is else covered by insurance on his health, life or property( 4).
Insurer He’s the party who undertakes in consideration of an quantum paid to him by the ensured( decoration) to pay plutocrat to the ensured or assured on the passing of a stated event. exemplifications of the kinds of insurers we’ve include, the Mutual Insurance Association, NICON Insurance Companies Limited, among other( 5).
Third Party There are two parties to an insurance contract, the insurer and the ensured. All others are nonnatives to the contract, and are appertained to as third parties because they aren’t parties to the insurance contract between the ensured and the insurer. For case, the rambler who’s knocked down by the ensured in a motor accident is a third party and a foreigner to the contract between the insurer and the ensured( 6).
Insurance Company A pot or association whose business is to make contracts of insurance( 7). It must also be registered under the Nigerian Law.
Conclusion
Insurance is fast getting a ménage name in Nigeria with further persons gradationally getting interested in the subject.
This chapter began with the general preface which breakdown the issue in question and tried to see it’s important or utility in helping us to understand the meaning of insurance and also satisfy our curiosity of knowing what insurance and the introductory principles of insurance is each about.
Though detail, the preface has tried to exfoliate light on the significance of insurance to our mortal race or actuality and description in place by judicial decisis. It went ahead to countries its points and objects of the study. It continued with compass of study, focus of study and followed by the exploration methodology which had been stated that’s the sources from which information concerning the design is gotten. The literature review isn’t leftout. Also, the exploration continued with certain terms that the anthology would be coming across in the course of this work. This chapter in its little way is a form of a steppingstone as to what should be anticipated in the exploration work in posterior chapters.
1)No. 68 of 1994
2)( 1904) 2K. B 658
3) Henry Campbell Black,M.A, Black’s Law Dictionary, Sixth edition, Centennial ed( 1891- 1999) p 8074 Ibid, p 808
4) Ibid. p 808
5) rd
IrukwuJ.O. Motor and Accident Insurance( 3ed.Heinemann, Ibadan,) 1991
6) IrukwuJ.O. Insurance Law and Practice in Nigeria.( Heinemann, Ibadan) 1991p. 12
7) Black’s Law Dictionary,p. 804
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