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Idemnity, Insurance Contract(s)
Last updated: 21-Jun-2015

Per Lord Ellenborough in Brotherston v Barber [1816] 5 M & S 418 at p.425:

The great principle of the law of insurance is that it is a contract for indemnity. The underwriter does not stipulate, under any circumstances, to become the purchaser of the subject matter insured, it is not supposed to be in his contemplation he is to indemnify only.

Per Brett J in Castellain v Preston [1883] 11 QBD 380 at p.386:

A contract of insurance contained in a marine or fire policy is a contract of indemnity, and of indemnity only, and this contract means that the assured in case of a loss against which the policy has been made, shall be fully indemnified but shall be never more than fully indemnified.

Per Lord Sumner in British & Foreign Marine Insurance Co. Ltd. v Wilson Shipping Co. Ltd [1921] 1 AC188 at p.814:

In practice contracts of insurance by no means always result in a complete indemnity, but indemnity is always basis of the contract.

Per Lord Wright in Rickards v Forestal Land, Timber and Railways Co Ltd [1941] 3 All ER 62 at p.76:

The object both of the legislature and of the courts have been to give effect to the idea of indemnity, which is the basic principle of insurance and to apply in the diverse complications of fact and law in respect of which it is to operate. In this way, the law merchant has solved, or sought to solve, the manifold problems, which have been presented by the insurers of maritime adventures.


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