Insurable Interest In Life Insurance – Yes, But When?

Insurable interest is one of the most fundamental concepts in insurance law and is not without its share of criticism and discombobulation. For the uninitiated, in the realm of life insurance, insurable interest in simple terms (if there is such a thing) is the interest one person has in another person's life in that it would prejudice that first person financially or emotionally if that other person were to come to harm or death. Cue the discombobulation.

On the surface, the concept of insurable interest can appear to be straightforward although there are pundits who would disagree. Malaysian legislation does not definitively define the term "insurable interest", but the Financial Services Act 2013 (and the Insurance Act 1996 and the Insurance Act 1963 before that) does enumerate the categories of persons in whose lives one is deemed to have insurable interest. The focus of discussion in this article, however, relates to the timing requirement of