A contract of insurance, like other contracts, can only be entered into by people sui juris. Either an individual or a corporation may be an insurer. In most states at the present time there are statutory requirements which must be complied with before insurance companies can write insurance policies.

A contract of insurance is not a contract for necessaries, and therefore one made by an infant may be disaffirmed. Until such disaffirmance, however, it is a binding contract. A contract of insurance made with an insane person is void, if he has been adjudged insane, otherwise only voidable. A contract of insurance with an alien enemy is void.

In addition to the qualifications required to make a person a competent party in the contract of insurance, the insured in an insurance company must have an insurable interest in the subject of insurance. What will constitute an insurable interest in this class of insurance contracts will be considered in the next three chapters.