Suppose I insure my goods against fire for RM100,00 and suffer a loss by fire of the insured goods for that amount. I shall be indemnified for the loss and receive RM100,000 out of the pool. Suppose I insure against the loss with two or three companies, would it be fair for me to claim from each company the sum of RM100,000? Clearly it would not, for I would be restored to a better position that I was in before. This would be against public policy, for it might encourage me to cause the loss to happen, so that my condition improves.
Such double insurance is unlikely today, and the insured might even be suspected of fraudulent intent. A more usual case would be where two policies overlapped, as for example where a burglary policy and an all-risks policy exist covering the same goods. The companies concerned will contribute to the loss proportionately, the exact division depending upon the terms of the original policies. To discover whether they should pay in full, or only contribute, every claim form asks the insured ‘Is any other company interested in the goods which are the subject of this claim?’ An honest answer to this question lets the insurance company know their true position.
No comments:
Post a Comment