Law of Insurance Contracts

Chapter 6



Rights under a contract of insurance are categorised as choses in action.2 Common law did not permit the assignment of choses in action, but eventually assignment was permitted by statute (below, 6-3). Meanwhile, an informal assignment was enforced by equity (below, 6-4) and equitable assignment has survived the introduction of the statutory modes of assignment.3 Indeed, equity is needed to accommodate assignments, which there is no ground for objecting to but which are not sustainable at common law or by statute. For example, the latter can be used to assign only existing choses in action; a future chose in action can be assigned only in equity.4 The content of Chapter 6 is ordered in the traditional way, first assignment at common law and then assignment in equity. However, a critic has justifiably observed that in the commercial world the reality is that “the equitable principles of assignment constitute the only general mode of transfer of incorporeal rights” for “the widest possible subject-matter”.5

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