4. A contact of fire insurance is a:
(a) Contract of indemnity
(b)Contract of guarantee
(c) Wagering agreement
d)None of these
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Explanation:
Contract of indemnity....
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ANSWER :
★ (a) Contract of Indemnity
- ❍ A contract of Fire insurance is a Contract of Indemnity.
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EXPLANATION :
❒ Contract of Indemnity :-
- ✎ According to Section 124 of Indian Contract Act, 1872, "A contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person, is called a "Contract of indemnity".
- ✎ In a Contract of Indemnity there are two parties. One is the "Indemnifier"— the person who promises to make good the loss, and the another is the "Indemnified" or "Indemnity holder" — the person whose loss is to be made good.
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❒ Elements of Contract of Indemnity :-
- ✎ Valid Contract : In the Contract of Indemnity, all the essential elements of a valid contract must be present.
- ✎ Loss to one party : In the Contract of Indemnity, a person can indemnify another person only if such other person incurs some loss or it has become certain that he will incur the some loss.
- ✎ Indemnity by the promisor : The purpose of the Contract of Indemnity is to protect the indemnified or indemnity holder from any loss that may caused to him.
- ✎ Reason for loss : The Contract of Indemnity must specify that indemnity holder shall be protected from the loss caused to him due to — [a] Action of the promisor himself or; [b] Action of any other person or; [c] Any act, event or accident which is not in the control of the parties.
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