Commentary

10 Bailments and insurance

BAILMENT vol 3(1)
| Commentary

10 Bailments and insurance

| Commentary

10 Bailments and insurance

The bailee has an insurable interest in the bailed goods1. The insurable interest extends beyond both the amount of the bailee’s own liability to the bailor and the loss which the bailee may personally suffer on the occurrence of a specified peril2. If the insurance contract is appropriately phrased3, the bailee can recover the full value of the goods (or the full cost of repair) from the insurer. The bailee holds the residue of the insurance money, after deducting his personal loss, for the bailor4.

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