INSURANCE, IN LAW.—The law on the subject of insurance is substantially the same throughout the United Kingdom.
Fire lasurance.—The contract is generally preceded by proposals, in which case the proposals and policy of insurance must be read together, if the policy refers to these proposals. In order to insure property, the insurer must have sonic interest in the property insured, for otherwise there would be an inducement to commit arson. But he need not lie owner; it is enough that he be accountable for the goods, or hold a lien on them, as a carrier, wharfinger, or bailee. Thus, many carriers keep up a floating policy to cover all goods which may happen to be on their pr raises within a given period. In all these cases, the words of the policy are the important points; and good faith is required in giving a correct description of the goods or premises, for every statement or representation as to anything that is essential is taken to be a warranty. The premises must not be materially altered during the risk, otherwise the policy will be void; but often the policy stipulates that alterations may be made on giving notice: A person in lodgings may insure his goods, and may safely call the house his "dwelling-house" for that purpose. But, as a general rule, great care most be taken by the insured not to misrepresent anything material, and not to conceal any extra ordi?ary risk which the insurer ought to know. If a tire happens, either on the prem ises, or in neighboring premises, the insurer cannot set up in defense that it was caused by the negligence of the insured or his servant, for these are generally the very things which an insurance is intended to guard against. When a fire happens, it is generally always provided by the policy that notice of the loss is to he sent in, and full particulars of the damage done, and the alleged value, for it is only the actual loss which is insured against, and that only can be recovered. Thus, if a person insures his house or furni ture for £600, and damage only to the extent of £50 hag been done by fire. he can only recover the £50, for Otherwise he would be better off than he was before the fire, and the contract is one merely of indemnity—i.e., it does not add to one's wealth, but merely secures against loss. It is often provided that the annual payment of the premium on a contract of insurance may be paid within 15 days after the first or previous year has expired, but it is dangerous to allow the payment to be postponed so long, for if a fire happen in the interval, the insurer will not in general be liable. Sometimes the same property is insured in several offices, but in that case the insured party eon nevertheless only recover the value of his loss once and no more. He can sue either of the insurers, however, for the amount, if each policy cover the whole value, and the party who pays can then recover a proportionate part from the other co-insurers, for they all divide the loss among them. In cases where carriers and others take out a float ing policy of fire insurance, the carrier can sue for the full loss of the goods, though far exceeding the extent of his own interest in them, but iu that case the owner of the goods destroyed is entitled to recover the balance from the carrier, even though originally he never gave authority to the carrier to insure them. And so, in like manner, if a person is insured, and recovers his loss from the insurer, and then sues a third party for the wrong which caused the loss, the insurer gets the benefit of what may thus be recovered, in diminu tion of his own loss.
Life Insurance is not a contract of indemnity, like the insurance, and therefore a person may insure his life in as many insurance offices as he pleases, and his executors will recover the full amount insured from each of the insurers, regardless of the rest. In order, however, to insure a life, the insurer must either himself be '• the life " or must have a pecuniary interest in the life. Thus, a creditor is entitled to insure his debtor's life; a wife may insure her husband's or her own, as if she were unmarried; and he may insure the wife's, if she has an annuity or property settled upon her for life, in which he has an interest. It is enough, also, that the interest of the insurer exist at the time the policy is entered into, and hence, though the interest afterwards cease, he will still be entitled to recover the amount, if the policy is kept up. Thus, a creditor whose debt is satisfied, may still recover on the policy. In entering into con tracts of life insurance, scrupulous good taith is exacted in the description of the nature of the life insured, and any fraudulent misrepresentation in a material point is fatal to the insurer's right to recover. Some companies even go the length of inserting in their policies a clause, that if any misrepresentation (i.e., however, trifling) be made, the policy will be void. But particular care should be taken to avoid such offices, for the policies taken out on such terms will generally be so much waste paper, as far as any security is concerned. At the same time, it is often dangerous for the insurer to treat lightly any misrepresentation, for in the end the question, whether it is material or not, will be one not for him or his executors, but for a jury, in case an action is brought. When the policy is effected through an agent on the principal's life, and the agent, unconsciously and without the authority of the principal, makes a misrepresentation, this will bind the principal. Where the person whose life is insured commits suicide, or is hanged, the policy is void, unless, in the case of suicide, he was in a state of insanity at the time. The policy, however, frequently has an express provision on this subject, the terms of which will be in that case all-important, and will govern the liability. In case the policy provides, as it often does, for its continuance, if payment after the expiration of the year is made within 15 or 21 days, it is dangerous to run the risk of this interval, for if the party dies during the 15 days before the premium is paid, the policy will not be set up by his executors coming forward to pay within those days. But the policy sometimes expressly allows of this, in which case it will be competent for the executors to make the payment. Life assurances are often assigned in security of a debt, in which case the assignor generally covenants to pay the premiums, so as to keep the security up; and failing payment by the assignor, the assignee is authorized to pay them himself, and recover the amount from the assignor. Notice of an assignment of a life policy should always be given to the insurance company, so as to let them know whom they are to pay.