INSURANCE LAW

LXEB 3311
THE RIGHTS OF A NOMINEE, ASSIGNEE AND A
BENEFICIARY OF A STATUTORY TRUST IN AN INSURANCE
POLICY IN MALAYSIA

NAME

: CHYREL RACHEL JAMES

MATTRIX NO.

: LEB130020

LECTURERS NAME

: DR. NUR JAANAH BINTI ABDULLAH

@ CHEW LI HUA

SEMESTER

1.0 INTRODUCTION

: SEMESTER 2, 2015/2016

Generally, in an insurance policy, the parties to it are the policy owner and the insurer. The rights
of a 3rd party in an insurance law are affected by mainly 3 things: doctrine of privity, defenses
available to the insurer and the application of laws in other areas.
Insurance policy is a contract. Hence, general principles of the law of contracts are applicable to
it. The law governing contracts in Malaysia are found in the Contracts Act 1950 1. The Act does
not expressly prohibit a 3rd party from enforcing a contract. Nevertheless, in the case of Kepong
Prospecting Ltd & Ors v Schidmt2, the Privy Council had affirmed the application of doctrine of
privity in Malaysia. It was further applied in the case of Capital Insurance Bhd v Cheong Heng
Loong Goldsmiths (KL) Sdn Bhd 3 and was held to be applicable in insurance contracts in
Malaysia by the Federal Court.
In addition to the doctrine of privity, a 3rd partys rights in insurance law are also affected by the
defenses available to the insurer when the policy owner took an action against him. This is due to
the fact that the insurer may account himself to such defenses when it is the 3 rd party who is
claiming from the insurer.
In this assignment, 3 types of third party rights will be discussed, namely a nominee, an assignee
and a beneficiary of a statutory trust.

1 Act 136
2 [1968] 1 MLJ 170
3 [2005] 6 AMR 177; [2005] 6 MLJ 593
1

STATUTORY PROVISIONS
There are a few statutory provisions in Malaysia which governs the rights of 3 rd parties in
insurance law. Among them are the Financial Services Act 2013 4 (FSA) and the Civil Law Act
19565 (CLA).
The FSA is the main legislation governing anything regarding insurance law in Malaysia. It
repealed the Insurance Act 19966 (IA). The legal and regulatory framework for the insurance
sector is substantially preserved in the FSA and remains under the regulation of the Central Bank
of Malaysia. Every guideline, direction, circular or notice under the repealed IA, issued and in
force immediately before 30 June 2013, shall be deemed to have been issued under a
corresponding provision in the FSA or any direction issued under the FSA and remain in full
force and effect until amended or revoked7. The Act does not expressly provide for the general
application conferring rights on a 3rd party in an insurance policy. However, there are still
provisions that confers rights on certain 3rd parties on specific types of insurance policies. The
provisions can be found in Schedule 10 and Schedule 8, Paragraph 10 specifically, in the FSA.
Schedule 10 is regarding the payment of policy moneys under life policy and personal accident
policy. This Schedule governs the rights of a nominee and beneficiary of a statutory trust of such
policies, as well as regulates the priority between certain interest holders of the moneys in the
mentioned policies. Schedule 8, Paragraph 11, of the FSA governs the position of an insured
person of a group life policy or a group personal accident policy.
4 Act 758
5 Act 67
6 Act 553. (Repealed)
7 Insurance Regulatory Framework under the Financial Services Act 2013 by Krystle Lui
2

The reception of English law in Malaysia is governed by the CLA. Section 3 8 and 59 of the CLA
allows the reception of relevant English laws under certain circumstances.

1.0 RIGHTS OF A NOMINEE IN MALAYSIA

Generally, moneys payable on a policy effected by a person on his own life belongs to him 10. The
policy owner may choose to deal with the policy moneys in accordance with the policy or to
dispose them by will. He may also nominate another person to receive them upon his death. The
nomination takes effect only upon the death of the policy owner, just like a will. According to the
case of Re Engelbachs Estate11, a 3rd party can be nominated by the policy owner to receive the
policy moneys when the insured event happens.
The procedure for nomination is prescribed under Schedule 10, Paragraph 2 of the FSA. The
statutory nomination in this Paragraph covers a nomination made by a policy owner who has
attained the age of 16 years. Section 130 of the FSA provided that the word policy in Schedule
10 of the Act includes a life policy under Section 23 of the CLA and a personal accident policy
effected by him upon his own life. In other words, it can be interpreted that the statutory
nomination does not cover the nomination of moneys payable under policy effected on anyone
else other than the policy owner.

8 Application of U.K. common law, rules of equity and certain statutes

9 Application of English law in commercial matters
10 Re William Phillips Insurance (1883) LR 23 Ch 235, p. 247
11 [1924] 2 Ch 348
3

So who can be a nominee? Para. 212 of Sch. 10 provided that where the policy owner wishes to
nominate a natural person, he or she must provide the insurer the proposed nominees personal
details. Due to the usage of the term may nominate in this particular provision, it can be said
that a nomination does not necessarily have to be a natural person. It merely provides the
required details of the nominee where he or she is a natural person. Therefore, a charitable body,
for example, can also be a nominee and will act as an executor upon receiving the policy
moneys, by virtue of Para. 6(1)13 of the same Schedule.
Para. 2(5)14 of the FSA provides that the insurers failure to register the nomination will not
invalidate it. Nevertheless, there appears to be an inconsistency with the fact that subparagraph
(4)(c) of the same Paragraph provides that a nomination takes effect only when the insurers
records it in the insurers register of policies 15. This might be due to Para. 3(1)(c) which provides
that a nomination, including a nomination to which Para. 5 applies, shall be revoked by any
subsequent nomination16. Therefore, even if the insurer fails to record the nominees details in the
register, the nomination would still be effective on the death of the policy owner, provided that
12 (1) A policy owner who has attained the age of sixteen years may nominate an individual to receive
policy moneys payable upon his death under the policy by notifying the licensed insurer in writing the
name, date of birth, national registration identity card number or birth certificate number and address of
the nominee.
13 6. (1) A nominee, other than a nominee under subparagraph 5(1), shall receive the policy moneys
payable on the death of the policy owner as an executor and not solely as a beneficiary and any payment
to the nominee shall form part of the estate of the deceased policy owner and be subject to his debts and
the licensed insurer shall be discharged from liability in respect of the policy moneys paid.
14 (5) A failure to comply with subparagraph (4) shall not affect the validity of the nomination if it is
otherwise proved that the nomination was made by the policy owner and given to the licensed insurer.
15 (4) The licensed insurer (c) shall return the policy to the policy owner after endorsing the
nomination on the policy or by issuing an endorsement to the original policy by registered mail to the
policy owner and the nomination shall take effect from the date the nomination is registered by the
insurer.

he has not made any subsequent nomination. To enjoy the rights conferred on him by the FSA,
the nominee must then prove that the policy owner has in fact submitted a completed nomination
to the insurer.
It must be noted that neither the insurer nor the policy owner is required to notify the nominee of
his nomination. The only time the nominee will be notified by the insurer is when the nominee
fails to claim the policy moneys within 60 days after the insurer found out about the death of the
policy owner. The insurer will then notify the nominee in writing to claim for his entitlement on
the policy moneys. This is provided under Para. 4(2) 17 of Schedule 10 under the FSA. The
importance of this knowledge to the nominee is that when the nominee has been notified about
his nomination, he has to option to reject or accept it. The policy owner then has the opportunity
to nominate another person in the event that the intended nominee rejects the nomination.
STATUS OF A NOMINEE
According to Para. 6 of Sch. 10 in the FSA, the nominee who claims for the policy moneys upon
the policy owners death shall receive them as an executor and not solely as a beneficiary 18. As
the nominee is the executor of the policy moneys, he has to settle the debts of policy owner with

16 3. (1) A nomination, including a nomination to which paragraph 5 applies, shall be

revoked(c) by any subsequent nomination.

17 (2) Where a nominee fails to claim the policy moneys within sixty days of the licensed insurer
becoming aware of the death of the policy owner, the insurer shall immediately notify the nominee in
writing at his last known address of his entitlement to claim the policy moneys.
18 6. (1) A nominee, other than a nominee under subparagraph 5(1), shall receive the policy moneys
payable on the death of the policy owner as an executor and not solely as a beneficiary and any payment
to the nominee shall form part of the estate of the deceased policy owner and be subject to his debts and
the licensed insurer shall be discharged from liability in respect of the policy moneys paid.
5

the policy moneys first, as they form part of the deceased policy owners estate, before
distributing the balance in accordance with the laws of succession applicable to the deceased.
It must be noted that according to Sch. 10, Para. 5, a trust is created when the policy owner
nominates his spouse or child, or his parents or one of his parents or a trust company if at the
time he does not have a living spouse or child 19. This will be further discussed in Chapter 4 of
this paper.
RIGHTS AGAINST THE INSURER
After deducting the moneys which are due under the policy or under any assignment or pledge,
the nominee shall receive the sum insured from the insurer. Nevertheless, if the policy owner has
nominated more than one person and directed that the policy moneys will be paid to the
nominees in specified shares, the nominee will only get his specified portion of the policy
moneys. In the absence of such instruction, the moneys will be distributed equally among the
nominees20.

19 5. (1) A nomination by a policy owner, other than a Muslim policy owner, shall create a
trust in favour of the nominee of the policy moneys payable upon the death of the policy owner, if(a)
the nominee is his spouse or child; or
(b) where there is no spouse or child living at the time of nomination, the nominee is his parent.

20 Paragraph 2(6), Schedule 10 of the Financial Services Act 2013

6

The nominee also has the right to claim since the insurer is required to pay the nominee under
Para. 6 of Sch. 10. According to Para. 1221, read together with Para. 4(2)22 of Sch. 10 of the FSA,
the nominee is subjected to a payment of a minimum compound interest if there are still no
payment of the claim for the policy moneys after sixty days since he has submitted his claim.
This is to highlight the rights of the nominee as against the insurer where the insurer fails to
make the payment for the claim after the claim is already made.
WHERE THE POLICY OWNER IS A MUSLIM
The FSA 2013 is silent on how the distribution of policy moneys would be in the event that the
policy owner is a Muslim upon his death. In such situation, the Islamic law principles shall
apply. In addition, s. 167(2) of the IA did provide that a nominee of a Muslim policy owner shall
also receive the moneys as an executor and shall distribute them in accordance with Islamic law.
Where the nomination is not considered as a bequest, the nominee is to divide the moneys in
accordance with faraid.
In the case of Re Ismail Rentah23, the deceased was a member of a co-operative society and had
nominated his daughter to receive the moneys standing in his account with the society.

21 12.(1) Where a claim or a part of a claim made under a life policy, or under a personal accident
policy upon the death of the policy owner is not paid by the licensed insurer within sixty days of
notification of the claim, the insurer shall pay a minimum compound interest at the average fixed deposit
rate applicable for the period of twelve months for licensed banks as published by the Bank plus one per
cent or such other rate as may be specified by the Bank, on the amount of policy moneys upon expiry of
the sixty days until the date of payment.
22 4.(2) Where a nominee fails to claim the policy moneys within sixty days of the licensed insurer
becoming aware of the death of the policy owner, the insurer shall immediately notify the nominee in
writing at his last known address of his entitlement to claim the policy moneys.
23 [1940] MLJ 98, p. 100
7

According to Raja Musa AJ, the nomination was a bequest but it is not valid under Islamic law as
it was made to an heir without the other heirs consenting to it.
The nominees rights to the policy moneys depend on certain Islamic law principles. As
mentioned before, in a situation where the nomination is a bequest, the policy moneys are to be
considered part of the residuary estate of the deceased policy owner, the nominee is to divide the
moneys according to faraid. Additionally, a Muslim can only bequeath one third of his estate to
his non-heirs. Any bequest exceeding an heirs prescribed entitlement will be considered as
invalid unless consented by the deceaseds other heirs after his (the testators) death. 24

2.0 POSITION OF AN ASSIGNEE IN MALAYSIA

An assignment, in the context of insurance, is the transfer of rights and obligations under a
policy25. Under this topic, two types of assignment will be discussed, namely an assignment of a
life policy and an assignment of the policy moneys of a life policy. There are 2 types of general
assignments in Malaysia. The 1st one is an assignment in accordance with Section 4(3) 26 of the
CLA. The 2nd type is an assignment in equity.
Under S. 4(3), the assignee will only enjoy the benefits under the provision if the elements in the
provision are fulfilled. There are 3 requirements that needs to be fulfilled:

24 n 14 above, at p.46
25 An Introduction to Insurance Practice and Principles in Singapore and Malaysia by R. C. Kohli, p. 77
8

1. The subject matter must either be a debt or other legal chose in action;
2. The assignor must have transferred the whole debt or all his rights in the legal chose
in action to the assignee; and
3. The assignment must be signed by the assignor, and written notice of it must have
been given to the debtor.
The assignee of an assignment under S. 4(3) has may sue under his own name, without joining
the assignor as a party to the suit. Nevertheless, the assignees rights against the debtor are
subjected to the equities and defenses which arises out of the assignment prior to the notice of
the assignment to the debtor. Additionally, they are subjected to the assignees own conduct after
the assignment has been made27. Furthermore, the debtor will not be discharged from his liability
to the assignee if he has made the repayment of the debt to or performs the chose in action in
favor of the assignor without the consent of the assignee 28. Hence, the assignee has a good
recourse against the debtor.
The existence s. 4(3) of the CLA does not forbid the creation of equitable assignments. Hence, it
is possible to create an equitable assignment over a part of debt or chose in action, or even over
an interest which has yet to exist at the date of the assignment. Furthermore, it does not need to
be in writing or notified to the debtor. In order to transfer his benefits under the contract to the
26 (3) Any absolute assignment, by writing, under the hand of the assignor, not purporting to be by way
of charge only, of any debt or other legal chose in action, of which express notice in writing has been
given to the debtor, trustee or other person from whom the assignor would have been entitled to receive or
claim the debt or chose in action, shall be, and be deemed to have been, effectual in law, subject to all
equities which would have been entitled to priority over the right of the assignee under the law as it
existed in the State before the date of the coming into force of this Act, to pass and transfer the legal right
to the debt or chose in action, from the date of the notice, and all legal and other remedies for the same,
and the power to give a good discharge for the same, without the concurrence of the assignor.
27 n 14 above, p. 56
28 n 29 above.
9

assignee, the assignor must have done everything necessary to be done according to the nature of
the property. The rights conferred on the assignee under the assignment cannot be withdrawn by
the assignor once the equitable assignment is effective.
Where a debtor breaches his obligations and the assignor refuses to sue, the assignee can only
sue if the assignor consented to him using his (the assignors) name. An assignee under an
equitable assignment has no capacity to sue under his own name as the chose in action is only
transferred in equity to him.
ASSIGNMENT OF A LIFE POLICY IN MALAYSIA
According to Para. 3 of Sch. 8 under the FSA, a person effecting a life policy insuring a life of
another must have the insurable interest in that life at the time the insurance is effected. Para.
3(3) of the same Schedule provides that a person is deemed to have an insurable interest in the
life of his spouse, child, ward under the age of majority at the time the insurance is effected,
employee or a person on whom he is wholly or partly dependent on.
Generally, an assignee of a life policy means he shall become the owner of the policy and enjoys
all rights thereunder. Nevertheless, his interest is still subjected to other competing interest under
the policy as well. For example, an assignees interest will be competing against the interest of an
assignee of the policy moneys or the beneficiary of a trust under Para. 5 of Sch. 10. There is no
provisions governing these competing interests. However, Para. 5(5)29 stated that a policy owner
can only create an assignment over the policy after he has created the trust with the consent of
the trustee. Hence, it can be understood that a subsequent assignment of a life policy created
29 (5) A policy owner shall not deal with a policy to which subparagraph (1) applies by revoking a
nomination or adding a nominee other than his spouse, child or parent under the policy, by varying or
surrendering the policy, or by assigning or pledging the policy as security, without the written consent of
the trustee.
10

without the consent of the trustee will not have any priority. Once a trust is created, only the
trustee can deal with it. If the trustee has not given his consent to it, the assignment is not
effective.
It must also be noted that a trustee should be acting in the best interest of the beneficiary.
Therefore, a trustee shall not consent to an assignment that does not benefit the beneficiary or if
the beneficiary does not consent to the assignee having priority over the policy moneys. If the
trustee insist to do so, he will breach his fiduciary duty towards the beneficiary.
ASSIGNMENT OF THE POLICY MONEYS OF A LIFE INSURANCE IN MALAYSIA
When assigning the policy moneys of a life insurance, the assignor transfers only his rights to the
moneys payable under the insurance policy. The assignor would remain as the policy owner and
the assignee does not need to possess insurable interest in the subject matter of the policy.
Para. 7 of Sch. 10 under the FSA expressly provided that policy moneys can be assigned wholly
or partly. Hence, it can be said that this Paragraph covers both legal and equitable assignment as
one of the requirements of a legal assignment under s. 4(3) of the CLA is for it to be assigned
absolutely. Since the policy moneys can also be assigned partly, equitable assignments are
recognized.
RIGHTS OF AN ASSIGNEE
Generally, the rights of an assignee of a general assignment is similar to the rights of an assignee
of the policy moneys. Where he is a legal assignee, he has the rights to claim and are able to give
a good discharge to the insurer. The assignees action against the insurer is subject to the same
defenses and equities available to the insurer as if the action is commenced by the assignor.

11

Additionally, Para. 7 of Sch.10 under the FSA regulates the competing priorities between the
assignee of a policy moneys and other interest holders.
Priority between the assignees of policy moneys
In a contest between competing assignees, the assignee who is first in time enjoys priority. This
is because Para. 7(2) 30 expressly stated that the priority of competing assignees of the policy
moneys are decided by the dates of their respective written notifications of the assignments to the
insurer.

Priority between an assignee of the policy moneys and a nominee

The existence of Para. 2(4)(a)31 encourages the policy owner to create an assignment over the
policy moneys in favor of his nominee where the nominee he intended is not his spouse, child or
parent, to receive the policy moneys as beneficiary.

30 (2) Where more than one person is entitled under the security or the assignment, the respective rights

of the persons entitled under the security or the assignment shall be in the order of priority according to
the priority of the date on which written notification of the security or the assignment was given to the
licensed insurer, both security and assignment being treated as one class for this purpose.

31 (4) The licensed insurer(a) shall prominently display in the nomination form that the policy owner

has to assign the policy benefits to his nominee if his intention is for his nominee, other than his spouse,
child or parent, to receive the policy benefits beneficially and not as an executor

12

A nominee, who is not the policy owners spouse, child or parent, shall receive the policy
moneys as an executor. An assignee, on the other hand, receives the policy moneys as a
beneficiary. A nomination is a contract between the policy owner and the insurer, where the
policy owner authorizes the insurer to pay the policy moneys to the nominee. As he is not a party
to the contract, he has no right against the policy owner. In contrast, the assignee of a policy
moneys has the right to make a claim from the insurer as he has the rights over the policy
moneys. Hence, it is submitted that an assignee should have priority over a nominee.
Priority between an assignee of the policy moneys and a beneficiary of a statutory trust
Para. 7(1)32 of Sch. 10 expressly stated that an assignee would still have priority even if there is a
trust created prior to the assignment. Once a trust is created, the policy moneys form part of the
trust property. The legal title and beneficial ownership of the policy moneys are vested in the
trustee and the beneficiary respectively. The policy owner would then have no more rights over
the policy moneys and cannot deal with it unless it is done through the trustee. Para 5(5) of the
same Schedule allows the policy owner, with the consent of the trustee, to assign or pledge the
policy, but not the policy moneys. Hence, it can be submitted that a policy owner may not assign
or pledge the policy moneys if a trust under Para. 5 is already created.

3.0 POSITION OF A BENEFICIARY UNDER STATUTORY TRUST IN MALAYSIA

32 7. (1) Notwithstanding a nomination under paragraph 2 or the creation of a trust under subparagraph

5(1), where the policy moneys, wholly or partly, have been pledged as security or assigned to a person,
the claim of the person entitled under the security or the assignee shall have priority over the claim of the
nominee and subject to the rights under the security or the assignment being preserved, the licensed
insurer shall pay the balance of the policy moneys to the nominee.

13

A trust under Para. 5 of Sch. 10 under the FSA is automatically created when a non-Muslim
policy owner nominates his spouse, child, or, when he has no living spouse or child at the time of
the nomination, his parent, to receive the policy moneys payable upon his death. Once the
nomination is made according to the prescribed procedure under Para. 2 of the same Schedule,
the nomination is effected. The nominee under Para. 5 will not enjoy the rights of a nominee as
provided under Para. 6 of Sch. 1033.
RIGHTS OF BENEFICIARY AGAINST INSURER
Para. 5(3)34 expressly provided that the insurer shall release the policy moneys to the trustee and
not the beneficiary. Hence, even if the beneficiary is supposed to benefit from the policy moneys
upon the death of the policy owner, he has no cause of action against the insurer for the policy
moneys. Additionally, if the beneficiary is also a trustee, he will then be able to receive the policy
moneys directly from the insurer. This is because Para. 5(3)(a) 35 allows the appointment of a
beneficiary who is competent to contract as a trustee as well.
RIGHTS OF BENEFICIARY AGAINST TRUSTEE
33 6. (1) A nominee, other than a nominee under subparagraph 5(1), shall receive the policy moneys

payable on the death of the policy owner as an executor and not solely as a beneficiary and any payment
to the nominee shall form part of the estate of the deceased policy owner and be subject to his debts and
the licensed insurer shall be discharged from liability in respect of the policy moneys paid.

34 (3) The policy owner may, by the policy, or by a notice in writing to the licensed insurer, appoint any

person other than himself to be trustee of the policy moneys and where there is no trustee appointed(a)
the nominee who is competent to contract; or
(b) where the nominee is incompetent to contract, the parent of the incompetent nominee other than the
policy owner and where there is no surviving parent, the Public Trustee or a trust company nominated by
the policy owner,
shall be the trustee of the policy moneys and the receipt of a trustee shall be a discharge to the insurer
for all liability in respect of the policy moneys paid to the trustee.

35 n 36 above.
14

In a trust, the trustee owes a fiduciary duty towards the beneficiary. Once a trustee breaches his
duty, the beneficiary can sue him for breach of trust. The trustee is required to act when the
policy owner dies and when the policy owner wishes to deal with the policy. As the trustee must
be acting for the benefit of the beneficiary, he must be very careful in exercising his discretion. A
trustee may only consent to the dealing if it benefits the beneficiary.
When a trustee breaches his fiduciary duty, the beneficiary shall have two options on what
actions should be taken. The first one is that he has a right to trace the policy moneys to the
interest holder. The interest holder is only not liable to account to the beneficiary if he is a bona
fide purchaser or that he has no knowledge of the trust created. The other option is for the
beneficiary to trace into the substituted assets in the trustees hands36.
An insurer is supposed to transfer the policy moneys to the trustee upon the death of the policy
owner. Where an insurer fails to do so, the trustee has the duty to take an action against the
insurer. A beneficiary may only apply to a court for an order to compe l the trustee to take an
action against the insurer when he (trustee) fails to do so. However, in this position, the
beneficiary is only able to do this if he is aware of the identity of the trustee.
It is further provided by Para. 5(3) that where there is no appointment of trustee by the policy
owner, the beneficiary who is competent to contract shall be the trustee. If he is not, the parents
of the incompetent beneficiary other than the policy owner himself shall be the trustee. In a
situation where there is no surviving parent of the incompetent beneficiary, the Public Trust or
the trust company nominated by the policy owner shall be the trustee.
RIGHTS OF BENEFICIARY AGAINST CREDITORS
36 n 14 above, p. 140
15

A beneficiary under Para. 5 is protected against the claims of the policy owners creditors when
the policy owner becomes bankrupt by virtue of Para. 5(2) 37 of Sch. 10 under the FSA. It
provides that the policy moneys shall not form part of the estate of the deceased policy owner
and are not subject to his debts. Nevertheless, the beneficiarys position may be affected by Para.
5(6)38 of the same Schedule where it is stated that where it is proven that the policy was effected
and premiums were paid with intent to defraud a creditor of the policy owner, the creditor shall
be entitled to receive from the policy moneys payable under a policy. The sum must be equal to
the premiums paid under that policy.

4.0 CONCLUSION

37 (2) Notwithstanding any written law to the contrary, a payment under subparagraph (1) shall not form

part of the estate of the deceased policy owner or be subject to his debts.

38 (6) If it is proved that the policy was effected and the premiums paid with intent to defraud a creditor

of the policy owner, the creditor shall be entitled to receive from the policy moneys payable under the
policy a sum equal to the premiums paid under that policy.

16

The rights of the third parties are one of the most important are in Insurance law. Due to the
limits imposed on this assignment, only 3 types of third party are able to be discussed. However,
it must be noted that there are still other types of third parties in Insurance law in Malaysia.
In conclusion, these 3 types of third parties have different rights as provided under the law. It is
important to be aware of your rights, especially when you are a third party, in insurance
contracts. This is to ensure that even as a third party, you will still be able to get what is
accordingly yours under the law.
The Financial Services Act 2013 which repeals the Insurance Act 1996 still holds much
similarities with the latter. Nevertheless, even with the existence of the FSA, the society evolves
throughout time and the law must always be updated in order for it to be efficiently developed
according to the needs of the community.

BIBLIOGRAPHY

17

CASES

Kepong Prospecting Ltd & Ors v Schidmt [1968] 1 MLJ 170

Capital Insurance Bhd v Cheong Heng Loong Goldsmiths (KL) Sdn Bhd [2005] 6 AMR

177; [2005] 6 MLJ 593

Re William Phillips Insurance (1883) LR 23 Ch 235
Re Engelbachs Estate [1924] 2 Ch 348
Re Ismail Rentah [1940] MLJ 98

STATUTES

Contracts Act 1950, Act 136

Financial Services Act 2013, Act 758
Civil Law Act 1956, Act 67
Insurance Act 1996, Act 553 (Repealed)
Malaysian Wills Act, Act 346, Rev 1988

OTHERS

Lui, S. (2014). Insurance Regulatory Framework under the Financial Services Act 2013.
Retrieved April 24, 2016, from http://www.theworldlawgroup.com/Document.asp?

DocID=113515
Abubakar, Yusuf Sani and Zahid, Anowar and Markom, Ruzian, Effect of Nomination
Under Life Insurance and Family Takaful (2014). ISRA International Journal of Islamic

Finance Vol. 6, Issue 1, 2014. Available at SSRN: http://ssrn.com/abstract=2750331

R. C. Kohli, An Introduction to Insurance Practice and Principles in Singapore and

Malaysia (1982), Singapore Insurance Training Centre.

Chan, W. M. (2008). Third party rights in insurance law in Malaysia. Petaling Jaya,
Selangor, Malaysia: Sweet & Maxwell Asia.

18

19