In the case of an insurance contract, the insured must have insurable interest. With no insurable interest, it will be a betting agreement. State governments can allow the horse racing competition if local laws permit. In such cases, a subscription or contribution valued at or above Rs.500 for a prize or amount of money to be paid to the winner of a horse race is not illegal. In other words, agreements to subscribe to that price or a sum or to contribute to a contribution are also valid and applicable. A necessary element of a betting agreement is that both parties should have a chance to win or lose because of the uncertain event. Therefore, it is not a bet if a party has a chance or a victory, but does not lose or a chance to lose, but not to win or not to win or lose. 3. In the insurance contract, the risk of loss is natural, while in the betting contract it is created by the parties. An insurance contract is a compensation contract that protects the interests of a party from damages and also has an insurable interest. On the other hand, a betting contract is a conditional contract and has no interest in an event taking place or taking place. Unlike insurance contracts, betting contracts are void and the purpose of a betting contract is to speculate on money or money, whereas the purpose of an insurance contract is to protect interest.
For an agreement to be a betting agreement, the purpose of the agreement must be subordinated to an uncertain event. In the case of Jethmal Madanlal Jokotia v. Nevatia-Co (1962), it was found that a bet usually relates to a future event, but it may also be an event that has occurred in the past, but the parties were not aware of their outcome or the date of their action. However, the law is, unlike the State of Maharashtra, in that state, the contracts of guarantees relating to bets are prevented from taking legal action by the special provisions of the Bombay III Act of 1865, sections 1 and 2 of the law run as follows:- An action is filed for the recovery of the party`s money to a betting contract as collateral for the performance of its part of the contract.