(229) In view of the usual ignorance of terms of policy, cancellation cannot be deemed mutual and insurer's consent was not a waiver of written notice, and therefore not binding. Bragg vs. Royal Ins. Co. (Me.) General agent was authorized to accept and act upon notice of cancellation. Ferrar vs. Western Assur. Co. (Cal) Cancellation by insurer was not binding upon mortgagee to whom no notice was given. Glasscock VS. Liverpool & London & Globe Ins. Co. (Tex.)....
Written notice of cancellation may be waived by insured-first policy was canceled when new policy issued. Violette vs. Insurance Co. of State of Pennsylvania (Wash). (230) Giving of five days' notice was sufficient to cancel policy and return of or offer to return premium was not an essential element of cancellation. Mangrum & Otter, Inc., vs. Law Union & Rock Ins. Co. (Cal.)
Fire policy may be canceled at any time before loss by agreement between the parties. Westchester Fire Ins. Co. VS. McMinn (Tex) (232) Action of company in denying liability on policy because insured had effected other insurance, contrary to his stipulation, was not a "cancellation" of the policy, calling for a return of the pro rata share of the premium. Ohio Farmers' Ins. Co. VS. Williams (Ind.)
While mere return of policy by mail to insurer's agent does not alone amount to cancellation, yet if returned with the obvious purpose of cancellation, receipt by insurer's agent would be cancellation. York vs. Sun Ins. Office (Ind)...
(235) Evidence sufficient to sustain verdict that policy was not canceled by mutual consent. Glens Falls Ins. Co. vs. Walker (Tex.).. (240) Act March 2, 1916, exempting state warehouse commissioner from its
operation as to discriminatory rates for insurance applies only to that taken in his business as commissioner, and is not invalid as denying equal protection to other insurers. Henderson VS. McMaster, Ins. Comr., et al. (S. C.)....
(243) Declaration of agent made after loss as a mere narrative of a past occurrence, though relating to insurer's liability, was not competent as against insurer. Johnson & Stroud vs. Rhode Island Ins. Co. (N. C.)... (245) Assured surrendered policy for cash and died before check was received. Executor sued for face value less amount of loan. Held, company complied with assured's request and was liable only for cash-surrender value. Lockwood, Admr. of Canfield, deceased, vs. New York Life Ins. Co (N. Y.).....
(247) Insurer cannot change status of beneficiary after death of insured. Oplinger vs. New York Life Ins. Co. (Pa.). Mere failure of company to return premiums on policy, void from beginning, is not waiver of right to forfeit. Seaback vs. Metropolitan Life Ins Co. (111.).
(249) Insurer's right to exhume insured's body, if covered by right to autopsy, can be exercised only at once and upon showing that it will show fraud or mistake. American Nat. Ins. Co vs. Nuckols (Tex)
Avoidance of Policy for Misrepresentation, Fraud, or Breach of
Warranty or Condition.
(250) Code relating to false representations must be given a liberal construction in favor of insured. Metropolitan Life Ins. Co. vs. Goodman (Ala.)
Statute providing that breach shall not defeat policy unless contributing to bring about destruction, is constitutional. McPherson VS. Camden Fire Ins. Co. (Tex.)..
Statute relating to construction of warranties and misrepresentations does not cover fidelity bonds. Commercial Bank vs. American Bonding Co. (Mo.) Mere falsity of answer in application insufficient to avoid policy unless insurer took steps to avoid it for such false warranty. National Live Stock Ins. Co. vs. Owens (Ind)... (253) To avoid policy there must be fraudulent concealment of material fact. Niagara Fire Ins. Co. vs. Layne (Ky.). Representations are not part of the contract in the sense that warranties are, but are inducements to contract. Commercial Bank V8 American Bonding Co. (Mo).....
(255) A representation in the renewal receipt of a fidelity bond that employee was not in default was a representation material to the risk. Commercial Bank VS American Bonding Co. (Mo.)..
If truth of matter stated in application is warranted, its falsity will avoid policy, though not material; but if a mere representation its falsity, will not avoid policy unless material Fitzgerald vs. Metropolitan Life Ins. Co.
(256) Where applicant signs application which is part of policy, he is bound
by its terms. Porter vs General Acc., Fire & Life Assur. Corp.,
Ltd. (Cal.)
Insurance procured by fraudulent representations is voidable though
statements related to immaterial matters. Fitzgerald vs. Metro-
politan Life Ins. Co. (Vt.).....
Material representations known to be untrue invalidate policy. Mutual
Life Ins Co. vs Hilton-Green and W. A. Finlay, Jr. (J. S.).... 260
Where fidelity bond provided that all representations made by em-
ployer were warranted to be true, employer's statement that
employee had not to the knowledge of employer been in default,
made when none of the officers of the bank knew, or had any
reasonable ground for knowing, that the employee was in default,
were not made recklessly, but in the honest belief that they were
true, and their untruth would not defeat the renewal bond. Com-
mercial Bank vs. American Bonding Co. (Mo.)..
(259) The duty of applicant to disclose material change for worse in health
after making application, implies knowledge on applicant's part
of such change. Fitzgerald vs. Metropolitan Life Ins. Co. (Vt.).. 508
(261) Court was entitled to infer that final unequivocal notice of rejection of
her demand was not given plaintiff before date within limitation
period. Simmons vs Modern Woodmen of America (Mo.)...... 621
(262) Instructions that if beneficiary induced insurer's agent to deliver
policy by false representations, policy never took effect, correct
and applicable. Fitzgerald vs. Metropolitan Life Ins Co. (Vt.).. 508
Mutual binding intention that contract shall be complete with terms
are agreed on, and only execution and delivery remain to be
done, does not exist where one party's action is induced by fraud.
Fitzgerald vs. Metropolitan Life Ins Co. (Vt.)...
(264) Insurance contracts are to be strictly construed against company if
necessary to prevent forfeiture. National Live Stock Ins. Co.
vs. Owens (Ind)
(265) Misstatements as to disease contracted two months before examination
was not breach of material warranty. Quinn vs. Mutual Life
Ins. Co. of N Y. (Wash ).
Statements made at the time of renewal of bond were only representa-
tions and not warranties. Commercial Bank vs. American
Bonding Co. (Mo)...
(267) A warranty is a parcel of the contract and must be absolutely true,
whether material or not. Commercial Bank VS. American
Bonding Co (Mo)
(268) If truth of matter stated in application is warranted, its falsity will
avoid policy, though not material; but if a mere representation
its falsity, will not avoid policy unless material. Fitzgerald vs.
Metropolitan Life Ins. Co. (Vt.)..
MATTERS RELATING TO PROPERTY OR INTEREST INSURED.
(274) Misdescription by agent does not render policy void. Dodge vs. Grain
Shippers' Mut. Fire Ins. Ass'n (Iowa)..
(282) Where insurer makes no inquiry, failure of insured to disclose existence
of mortgage will not avoid policy. Niagara Fire Ins. Co. VS.
Layne (Ky.)...
Policy was forfeited where insured was not owner of property but
tenant of his wife, house being situated on her land. Home Mut.
Fire Ins. Co. vs. Pittman (Miss.).
Neither option nor invalid or conditional contract of sale will constitute
a breach of condition of unconditional ownership. Houseman
vs. Home Ins. Co (W. Va.)..
Where fire policy contains clause voiding policy for other than un-
conditional ownership, fact that insured held under a bond for
title at time insurance was effected would not alone be sufficient
to answer requirements of such clause. Liverpool & London &
Globe Ins. Co. vs Hughes (Ga.)...
Policy, not mentioning incumbrances, but providing for fee-simple
ownership, is not breached by existence of mortgage liens.
Terminal Ice & Power Co. vs American Fire Ins. Co. (Mo.)..... 419
An unconditional ownership relates to quality of title and not to
question of liens or incumbrances. Insured had unconditional
ownership notwithstanding provision of existing contract to
build a boat for H, that, should its completion be prevented,
all materials bought for it should belong to H., etc. Lloyd vs.
North British & Mercantile Ins Co. of London & Edinburgh
(N. Y.)
(285) Statement as to interests in various businesses, etc., made by president
of a bank in good faith were not misrepresentations. Commercial
Bank vs. Maryland Casualty Co. (Mo.)...
(288) Provision as to other insurance is valid and reasonable. Ohio Farmers'
Ins. Co. vs. Williams (Ind.)...
There was no breach of warranty by insured in regard to other policy
where other policy was recalled by insurer under its absolute
right. Goldberg vs Massachusetts Bonding & Ins. Co. (N. Y.).. 672
MATTERS RELATING TO PERSON INSURED.
(291) Answers concerning disease of eyes are material.
Acc., Fire & Life Assur. Corp, Ltd. (Cal.)
Statement that insured was not in sound condition was not a matter
vitiating policy notwithstanding insured had hernia. Hines vs.
New England Casualty Co. (N. C)....
Applicant is bound to disclose such changes in physical condition as
occurred pending negotiation as would influence insurer's judg-
ment as to advisability of risk-held, on delivery in absence
of insurer's knowledge of sickness, policy was properly rescinded.
Security Life Ins. Co. of America vs. Booms et al (Cal)..
(292) False representations as to health, render policy voldable at election
of insurer. Metropolitan Life Ins. Co. vs. Solomito (Ind.)......
Forfeiture of Policy for Breach of Promissory Warranty, Covenant,
or Condition Subsequent.
(A) GROUNDS IN GENERAL.
(304) While warranty must be literally true or policy does not attach, that
which is promissory in its nature is not strictly construed.
National Live Stock Ins. Co. vs. Owens (Ind.).
(308) Breach of mere technical or immaterial provision in an insurance
policy which does not contribute to loss will not defeat or forfeit
policy. McPherson vs. Camden Fire Ins. Co. (Tex.)..
(309) Courts look with disfavor upon forfeitures and the trend of modern
authority is that stipulation which might avoid policy does not
do so if it in no way contributes to the loss. Johnson & Stroud
vs. Rhode Island Ins. Co. (N. C)....
MATTERS RELATING TO PROPERTY OR INTEREST INSURED.
(322) Tenant's going into possession of premises insured by landlord does
not breach policy provision against "change of possession."
Terminal Ice & Power Co vs. American Fire Ins. Co. (Mo.).... 419
(323) Provision in policy that it shall be void if property covered is un-
occupied for ten days without consent, merely suspends insurance
during unoccupancy. Beecher VS. Vermont Mutual Fire Ins.
Co. (Vt.)
(328) Conditional sale before loss was change other than by death of insured
in interest. Fire Ass'n of Philadelphia vs. Perry et al. (Tex.)..
Policy is not avoided by commencement of foreclosure proceedings on
claim for mechanic's lien having no legal basis. Dodge vs.
Grain Shippers' Mut Fire Ins. Ass'n (Iowa)...
Bill of sale did not operate as assignment. King vs. Hartford Fire
Ins. Co.-King vs. Springfield Fire & Marine Ins. Co. (Minn.).. 298
Where policy covering partnership property is voidable by change of
title, sale or interest by one partner to third person affects the
risk and ends the contract. Fireman's Ins. Co. vs. Larey
(Ark.)
Giving of mere option, not exercised, on insured property, does not
breach provision against change of interest or title. Terminal Ice
& Power Co. vs. American Fire Ins. Co. (Mo.)...
Where owner had sold half interest to eighteen year old son, taking
note therefor and insurer's agent knew it, policy was not void on
account of change of ownership. Merchants' & Bankers' Fire
Und. vs Brooks (Tex.)
Where owner assigned all property for benefit of creditors, assignee
taking immediate possession, the policy which provided that it
should be void if any change took place in interest, title, etc.,
and became void. Smith vs. Security Mut. Fire Ins. Co. (S. D.).. 425
(333) Policy of fire on personalty which provided that keeping of gasoline on
premises should avoid policy and increasing hazard should
do likewise, was not avoided where keeping of gasoline did not
contribute to or bring about destruction. Commonwealth Ins.
Co. of N. Y. vs. Finegold (Tex.)....
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(335) Statute providing that no breach or violation shall render policy void
or constitute defense unless they contribute to bring about the
destruction, refers to those warranties to be performed before
the fire, and does not apply to warranties requiring the keeping
of books, etc. McPherson vs. Camden Fire Ins. Co. (Tex.).....
Statute providing that no breach shall avoid policy unless contributing
to loss has no application to permit the insured, who has broken
the stipulation of his policy insuring his stock of goods that he
should keep books, etc., in an iron fireproof safe to recover on
the policy, although the failure to keep the books did not con-
tribute to bring about the destruction of the property, since
statute was passed to prevent companies from escaping liability.
Commonwealth Ins. Co. of N. Y. vs. Finegold (Tex.)..
A book wherein the owner of a pool hall entered the amounts of
money taken in, paid out, etc., was a compliance with policy
of burglary insurance requiring keeping set of books. Gueringer
V8. Fidelity & Deposit Co. of Md. (Mo.).....
Breach of inventory provision bars recovery.
Westchester Fire Ins. Co.
vs. McMinn (Tex )..
The petition as amended shows an absolute breach of iron safe clause
by insured after policies were completed and the court erred in
overruling the demurrer and refusing to dismiss petition.
Royal Exch Assur of London. Eng., vs. Gilmore (Ga.).
Holder of policy which required taking of inventory in order to recover
must comply Cohen vs. Home Ins. Co. (Del.)...
Retail merchant who endeavored to conduct cash business and kept
book showing inventory of all purchases and cash sales made
by him and preserved it in an iron safe has complied with iron
safe clause Houseman vs. Globe & Rutgers Fire Ins. Co.
(W. Va.)
Book warranty clause complied with by assured if set of books kept
by him are sufficient to enable men of ordinary intelligence to
ascertain amount and value of goods destroyed Queen Ins.
Co. of America vs Dalrymple et al. (Okla.).
(336) If mortgagor and mortgagee have separate insurance, then neither
policy can be said to be "additional" insurance, since that term
refers to the insurable interest in property. Hackett vs. Cash
(Ala.) ..
NONPAYMENT OF PREMIUMS OR ASSESSMENTS.
(349) Where policy provides it shall be void if premiums are not paid when
due, default in payment of premium when due will determine
insurance without any action by insurer, and policy cannot be
revived without a new contract. Edington vs. Michigan Mut.
Life Ins. Co. (Tenn.)....
Where note contains express stipulation that if not paid at maturity,
it will automatically cease to be a claim against maker, policy
may be avoided without returning note. Sims VS. Jefferson
Standard Life Ins Co. (Ga.)...
Where note provides for forfeiture if not paid at maturity, default
in payment relieves company from liability on policy. Marshall
vs. Farmers' & Bankers' Life Ins. Co. (Kan.).
Policy of life insurance without any qualifying provisions is not for
a single year with privilege of renewal, but is an indivisible
and continuous contract. Friend vs Southern States Life Ins.
Co (Okla.)
(355) Where agent testified he failed to attach coinsurance clause to policy
by mistake and after its delivery he mailed coinsurance clause
to insured, sent one to insured's office and retained one in his
own office and then made an entry in his own office, the registry
was admissible in corroboration of testimony. Johnson & Stroud
vs. Rhode Island Ins. Co. (N. C.)..
(360) Evidence of waiver was incompetent because not pleaded and evidence
out in record if competent was insufficient and order of trial
court sustaining a demurrer to evidence was not error. Wolff vs.
German-American Farmers' Mut. Ins Co. (Okla)....
It was duty of life company to apply dividend which was sufficient to
pay quarterly premium. Mutual Life Ins. Co VS. Henley
(Ark.)
(362) Forfeiture cannot be predicated upon nonpayment of assessment which
was insufficient Barber vs. Hartford Life Ins. Co. (Mo.)....... 391
(364) Equitable value constitutes its reserve fund. Ruane VS. Manhattan
Life Ins Co. (Mo)....
287
(365) Provision for one month's grace in payment of premium, became part
of policy upon reinstatement. Edington vs. Michigan Mut. Life
Ins. Co. (Tenn.)
(366) Insurer was bound to give notice of its option to treat indebtedness
as against the policy. Missouri State Life Ins. Co. vs. Crabtree
(Ark)
(367) Fact of the loan did not forfeit right to extended insurance for full
amount. Algoe vs. Pacific Mut. Life Ins. Co. of Cal. (Wash).... 192
Company not bound to apply other part of statute forbidding deduction
of loan from reserve. Ruane vs. Manhattan Life Ins. Co. (Mo.).. 287
XI. Estoppel, Waiver, or Agreements Affecting Right. to Avoid or
Forfeit Policy.
(371) Company may waive condition of policy.
Guntrum vs. Prudential Ins.
Co. of America (N. Y.).....
To constitute waiver of forfeiture it must appear that company ex-
pressed intention to relinquish defense Seaback VS Metro-
politan Life Ins. Co. (Ill.).
(872) Condition in policy or premium notes of forefiture of policy may be
waived. Hall vs Dakota Mut. Life Ins. Co. (S. D.).
(375) Soliciting agent who attempted to collect premium must be deemed
agent of insurer. Madsen vs. Prudential Ins. Co. of America
(Mo.)
Countersigning agent with authority to deliver, etc, has legal power to
waive by parol. Cohen vs. Home Ins. Co. (Del.)..
Charter and by-laws of mutual company's charter are part of contract
and cannot be waived by officers. Leonard vs. Farmers' Mutual
Fire Ins. Co (Mich.).
(876) Clause providing that no agent has authority to waive policy is solely
for benefit of insurer. Hopkins vs. Connecticut General Life Ins.
Co. (N. Y.)...
Alleged waiver of requirement of immediate notice was ineffective.
Bailey vs. First Nat. Fire Ins. Co. of Wash., D. C. (Ga.)..
Local agent authorized to deliver, collect, etc, may waive conditions
and forfeiture. New Jersey Fire Ins. Co. vs. Baird (Tex).... 322
(377) Company cannot claim an avoidance for vacancy where it had knowl-
edge of such vacancy. Dodge vs. Grain Shippers' Mut. Fire Ins.
Ass'n (Iowa)
(378) Where company reinstates policy which has been canceled after knowl-
edge of breach of policy, forfeiture is waived. Home Ins. Co. of
N. Y. vs. Mobley et al. (Okla.).
If company's local agents insured property as builder's risk and
parties to contract so understood it, company cannot claim it
was incorrectly described. Dodge vs. Grain Shippers' Mut. Fire
Ins. Ass'n (Iowa)
Where agent was informed policy was valid notwithstanding plaintiff's
qualified ownership. Hudson vs. Glens Falls Ins. Co. (N. Y.).. 205
Designation as agents of company made by statute does not affect true
relationship of the parties to life contract. Mutual Life Ins. Co.
vs. L. Hilton Green and W. A. Finlay, Jr. (U. S.)...
Agent did not have the knowledge from statement of insured which
could be imputed to company sufficient to estop it to question
validity of policy on ground of misrepresentation. Quinn vs.
Mutual Life Ins. Co. of N. Y. (Wash.).
Where agent was fully advised company could not refuse payment on
ground that that interest was other than sole and unconditional
ownership Fidelity-Phoenix Fire Ins. Co. vs. Ray (Ala.).
Company is charged with general agent's knowledge of assured's use
of gasoline. Globe & Rutgers Fire Ins. Co. vs. Indiana Re-
duction Co. (Ind.).
(379) Where applicant signs application certifying to the truth of statements
therein contained, they became his solemn representations though
they be filled out by agent. Porter vs. General Acc., Fire & Life
Assur. Corp., Ltd. (Cal.)
(383) Countersigning agent cannot, after delivery and before loss, waive by
parol an iron safe clause in policy. Cohen VS Home Ins. Co.
(Del)
Agent authorized to waive conditions, may waive them by parol. New
Jersey Fire Ins. Co. vs. Baird (Tex.).
(384) Formal notice that if policy were in force on certain date, premium
would be payable, was not a waiver of any default. Wichita
Southern Life Ins. Co. vs Roberts (Tex.)...
(388) Insurer could destroy the validity of an assignment only by declaring
policy void. Foryciarz vs. Prudential Ins. Co. of America (N. Y.) 29
Where, after delivery of policy containing iron safe clause, insured
asked countersigning agent what was meant by clause, stating
he had no safe, and was assured it was intended only for dis-
honest persons, company is not, a loss having occurred, estopped
to set up insured's failure to comply. Cohen vs. Home Ins. Co.
(Del)
Where it appeared that illuminating gas was generated on premises
when policy was issued and it was known to defendant's agent,
there was waiver of contrary condition. Marx vs. Williamsburgh
City Fire Ins Co. (Mich.).
When insurer knows of right entitling it to declare forfeiture of policy
and fails to assert it, law will regard it as having waived that
right. York vs. Sun Ins Office (Ind.)
(389) Where company issues policy with actual or constructive knowledge that
assured is using an article prohibited by its terms, issuance waives
prohibition. Globe & Rutgers Fire Ins. Co. vs Indiana Reduction
Co. (Ind.)
(390) Where policy was issued on inventory and its insufficiency was not
quoted by agent, it was too late after property had been de-
stroyed for insured to say that it was insufficient. Mitchell vs.
Etna Ins. Co. (Miss.)
Foreclosure proceedings were waived. Fidelity-Phoenix Fire Ins. Co.
vs. Ray (Ala.)..
(391) Where life company accepted premiums from assignee but attempted
to secure releases from him of his claims, there was a waiver of a
clause in the policy avoiding it on assignment. Holleran vs.
Prudential Ins. Co of America (U. S.)..
Where insured, after some debate, selected a rider form to be attached
to his automobile policy to cover loss by direct collision, and
shortly thereafter, on loss occurring, was informed by company
that the rider did not cover it, company by paying the loss
because it was small, was not estopped to deny liability for
future similar losses Browne vs Commercial Union Assur. Co.
(Cal.)
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