Insurance And Joint Law Commission Proposals Essay

Insurance And Joint Law Commission Proposals - Essay Example In order to uphold such contracts, insurance is guided by Insurance Contract Law that defines the relationship between an insured and insurer. Insurance contract law in the United Kingdom has for a long time been considered outdated (Netherway, 2012). For instance, the Marine Insurance Act (MIA) was created and passed in 1906 and has not been reviewed. Nevertheless, there are major developments in motor and aviation insurances, business globalization, development of the property, and the recent natural disasters have demanded serious and extensive reforms, especially within the insurance contract law. In order to appraise the Joint Law Commission proposals for the reform of the law relating to business insurance, considering further the case for differential treatment of Micro-businesses, the following discussion demonstrates solid understanding of the theory and practice of insurance. In addition, the discussion demonstrates sound understanding of key issues pertaining to the law of the insurance. Lastly, the paper provides a critical appraisal of Joint Law Commission proposals before winding up with a summary of the main points. Insurance is a contract where risk financing is attainable through pooling of risks. Insurance is a form of risk management practices within firms, entities, and amongst various individuals (Lawcommission.justice.gov.uk, 2012). Insurance services, though auxiliary, are aimed at reducing the adverse financial impact that firms, entities, and individuals meet in the event of an occurrence of risks (Smith, 2012). Therefore, insurance within the global arena is a vital element especially with respect to financial planning. UK insurance law that defines and regulates contracts between insured and insurers made several proposals (Hamilton, 1995).