Under English law, what is necessary for a person to insure the life of another?

To insure the life of another person under English law, it is essential to establish a financial relationship recognized at law. This principle stems from the concept of insurable interest, which is fundamental in insurance contracts. Insurable interest requires that the person taking out the insurance policy has a legitimate stake in the well-being of the insured party, meaning that the insurer would suffer a financial loss if the insured were to pass away.

This financial relationship serves to prevent moral hazard and ensures that insurance is used as a risk management tool rather than a speculative venture. For instance, if a person has a financial interest in another’s life—such as a business partner or a person who has provided significant support—then they are legally justified in obtaining life insurance for that individual.

While factors like consent and familial relationships can play important roles in specific situations, the core requirement under the law is that a valid financial interest must exist to legally bind the parties in an insurance contract. Thus, recognizing this relationship is crucial for the enforceability of the insurance agreement.