INSURANCE. – The insurance contract (the earliest examples of which date back to the late Middle Ages for maritime insurance, to the 16th century for fire and life insurance) is a synallagmatic and aleatory contract (see CONTRACT), by which the insurer (who, under current Italian law, can only be a public-law institution or a joint-stock company) undertakes, in exchange for the payment of a periodic sum (premium) by another party (the insured), either to indemnify the latter, within the agreed limits, for damage arising from a future, possible event (property insurance), or to pay, in a lump sum or periodically, to the insured or a third party, a sum upon the occurrence of an event related to human life (life insurance).
The contract is generally evidenced by a document (policy), issued by the insurer, who signs it, to the other contracting party; such a policy may also be made out to order (i.e., transferable by endorsement) or to bearer.
Insurance may also be taken out in the name of another or on behalf of another; in such a case, the insured is not the contracting party, but the person in whose name or on whose behalf the contract is lawfully made.
In no case, however, is the insurer obliged to indemnify for damage arising from events caused by the fraud of, or (unless otherwise agreed) gross negligence on the part of, the contracting party, the insured, or the beneficiary. Moreover, a property insurance contract is void if the insured has no insurable interest in the indemnification of the damage.
From a moral standpoint, both the insurer and the insured or beneficiary are bound to act in good faith, and the latter are obliged to return any indemnity received for damage for which they themselves are directly responsible or which is due to causes that, according to the terms of the contract, they were required to disclose.
Life insurance may be taken out either on one’s own life or on that of a third party; in both cases, it may involve the insurer’s obligation to pay a sum either upon the death of the person (provided that, if it is a third party, the contract is made with their consent) or upon their survival to a specified time. It may also be taken out for the benefit of a third party (beneficiary) to be designated in the contract itself, or by subsequent written declaration communicated to the insurer, or by will. However, if the insured commits suicide within two years of the contract’s date, the insurer is not liable for payment, unless otherwise agreed.
The general rules on insurance are laid down in articles 1882–1927 of the Civil Code. Special laws govern insurance companies and mutual insurance (cf. also articles 2546–48 of the Civil Code). Insurance against maritime, inland, or aerial navigation risks is regulated, in addition to the provisions of the Civil Code, by special rules contained in articles 514–47 and 996–1021 of the Navigation Code.