Every jurisdiction has a rule against wager contracts, developed to discourage speculation in human life and attendant moral hazard.2 In the life insurance context, the rule in Missouri prohibiting wager contracts applies only "where a policy is taken out by, and premiums paid by, a person who has no insurable interest in the life of the insured, or when a policy has been assigned for speculative purposes."3 The Missouri Supreme Court, in Estate of Bean v. Hazel, correctly limited the creditor's recovery on the debtor's life insurance policy to the amount of the debt, plus interest. However, in doing so, the court disregarded precedent set in Butterworth by holding that the rule against wager contracts applies even when the insured takes out the life insurance policy and pays the premiums.

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