According to common law, when should insurable interest be present in a life insurance contract?

A. At the time of taking policy

B. At the time of claim

C. Both A & B

D. None of the above

Answer: Option A

Solution(By Examveda Team)

According to common law, At the time of taking policy insurable interest must be present in a life insurance contract. If there was no insurable interest requirement, some people would be tempted to purchase life insurance policies to collect the death benefit by killing the insured. A person is always considered to have an unlimited insurable interest in his own life and health.