The Law Commissions have issued a paper entitled insurable interest and Parametric Policies (April 2016):
https://www.scotlawcom.gov.uk/index.php/download_file/view/1593/10 in which they discuss parametric policies and related instruments and set out how they think their proposed recommendations on insurable interest would apply to such policies.
How do you consider that the doctrine of insurable interest should apply to parametric policies? Do you agree, or disagree, with the Law Commissions’ recommendations? Your answer should include a critical analysis of the application of insurable interest to parametric policies.
The insurable Interest Bill states that the only persons who have an automatic insurable interest in each other due to natural affection are (1) a person who ‘is,or is treated as, the child or grandchild of the insured’, and (2) a person who ‘is the spouse or civil partner of the insured or lives with the insured as a spouse or civil partner’.
Do you agree with the above categories or would you limit or extend them? Your answer should include a critical analysis of this issue and the reason why you agree, or why you do not agree?