The contract of insurance is basically governed by the rules and regulations, which form part of the general law of the contract (Provisions of Indian Contract Act 1872).
However, over the years, special principles of insurance and also a full-fledged Law of Insurance took origin from the common law. The history of insurance, right from the 16th century, gives an effective clue to the need, origin and evolution of the said special principles of insurance. Some of these principles owe their existence to the fact that the documents of the standard insurance contract, principally the proposal form and the policy, have long been drafted in a fairly uniform way. It was in the mid-18th century that Lord Mansfield, the then chief justice in the UK, who first applied the principles of insurance, derived from common law concepts to the solution of disputes over insurance, making a beginning for the establishment of jurisdiction of courts over insurance consumers and consumer disputes.
The principles conceptualized in marine insurance have been applied, by and large, to property and liability insurances, which were developed subsequently. The marine insurance law was codified in the Marine Insurance Act 1906 (UK) which is generally regarded as sui generis.The said statute was virtually re-enacted in our country in the year 1963, with a few changes, but retaining the caption of the Act. |
