Meaning of Wagering and Insurance contracts and key differences are:
Contract of Insurance
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Wagering Agreement
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1. A contract of insurance is a contract
to make good the loss of property (or life) of another person against some consideration called premium.
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1. A wagering agreement is an agreement to pay money or money's worth on the happening of an uncertain event.
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2. In a contract of insurance the insured must have insurable interest. Without insurable interest it will be a wagering agreement.
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2. No insurable interest is necessary in case of a wagering agreement.
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3. In a contract of insurance both the parties are interested in the protection of the subject matter, i.e., there is mutuality of interest.
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3. In a wagering agreement, there is conflict of interest and in reality there is no interest at all to protect.
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4. Except life insurance, a contract of insurance is a contract of indemnity, i.e., a contract to make good the loss.
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4. In case of a wagering agreement there is no question of indemnity. On the happening of the event fixed amount becomes payable.
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