If the company ensures separate individual things which consist of basic legal requirements then it is legal.
Few frequently cited legal principles of insurance include the following:
a) Indemnity :-
The insurance companies insure, or counterbalance which is protected by insurance in the case of certain losses only up to the insured's interest.
b) Insurable interest :-
The insured having the distinctive qualities of a particular type of person or things must directly suffer from the loss.
c) Extreme good faith :-
Honesty and fairness bounded by a good faith bond the insurer and the insured.
d) Contribution :-
Insurers have similar being indebted for favors to the insured which can contribute in the indemnification, according to some method.
e) Subrogation :–
Insurance company gets legal rights to pursue regain possession on the behalf of the insured; for example, the insurer may ask for those liable for insured's loss.
f) Deputy Cause :–
The cause of loss (the "peril") must be concluded under the insuring agreement of the policy, and the chief cause must not be shut out.
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