Legal Entity (Juristische Person)
A legal entity is a legally independent legal person that can hold rights and obligations in its own right as a policyholder, insured party, or insurer.
Concept
A legal entity is a legal person recognized by law, distinct from the individuals who make up its members or officers, that can hold rights and obligations in its own right. Legal entities include, in particular, corporations (e.g., stock corporations, limited liability companies), associations, foundations, and public-law bodies.
Relevance in the Insurance Contract
Legal entities can appear in an insurance contract as the policyholder, as the insured party (for example, in general liability or D&O insurance), or, in the case of insurance undertakings themselves, as the insurer. For risk assessment and contract design, it is relevant that a legal entity generally has no life, health, or personal criminal culpability of its own, meaning that corresponding insurance products (e.g., life or accident insurance) must attach to natural persons instead.
Distinction from Natural Persons and Partnerships
Legal entities must be distinguished from natural persons (individuals) and from partnerships (e.g., general partnerships, limited partnerships), which, depending on the jurisdiction, have only limited or no legal capacity of their own; this distinction has particular implications for the allocation of liability, authority to conclude contracts, and the tax treatment of insurance benefits.