Insurable Interest In Insurance
Section 14. An insurable interest in property may consist in:
(a) An existing interest;
(b) An inchoate interest founded on an existing interest; or
(c) An expectancy, coupled with an existing interest in that out of which the expectancy arises.
What is existing interest?
Existing interest in property is the legal or equitable title on the property.
What is an inchoate interest?
It is an interest which has not yet ripened, such as the interest of a stockholder in the property of the corporation which he owns stocks.
In what kind of expectancy may insurable interest consist?
The expectancy MUST be coupled with an existing interest in that, out of which such expectancy arises. Examples would be: a farmer insuring future crops that he will grow on his land, or a workman insuring the building which he was contracted to repair.