Page 7 - Life Assurance

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Distinguishing Legal Characteristics

Of Insurance Contract

There are several legal characteristics of
insurance contracts and their issuing parties
that distinguish them from another contracts
and contracting parties. Reference has already
been made to some of these characteristics
such as:

- The fact that insurance is a contract of
indemnity,

- Insurance contract is personal in nature,
- And is a contract of utmost good faith.

Additional characteristics are analyzed
below:-

It's important to distinguish insurance
policies from other commercial contracts for
several reasons:-

- First of all, for tax and regulatory
purposes, the insurance business is viewed quite
differently from other business. Special statutes
have been passed to give insurance firms particular
tax status, some of which are especially favorable to
the insurer.

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