Jim is buying a new flat. At what point does he first acquire an insurable interest in the property?

Jim first acquires an insurable interest in the property when he becomes contractually bound to buy the flat. Insurable interest refers to a financial stake in the property, meaning Jim would suffer a loss if the property were damaged or destroyed. This interest arises at the moment a binding contract is made, as he is now legally committed to the transaction and has rights to the property, though he may not yet have possession.

Making an offer does not create a legal obligation or entitlement to the property. Approval of a mortgage application is an important step in the financing process but does not grant ownership or interest in the property itself. Moving into the flat indicates possession but does not give rise to an insurable interest prior to the contractual agreement being in place. Thus, the acquisition of insurable interest is firmly established when Jim becomes legally bound to the purchase through a contract.