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SECTION IV.

THE INTEREST OF THE INSURED.

EVERY one insured in any way must have an interest in the subject-matter of the insurance. A person may effect insurance on his own life in the name of a creditor, for a sum beyond the amount of the debt, the balance to enure to his family, and the policy will be valid for the whole amount insured. Any one may insure his own life; but if the insured and the life-insured are not the same, that is, if the insured be insured on some other life than his own, interest must be shown.

A father has an insurable interest in the life of his minor son. And the general rule is, that any substantial pecuniary interest is sufficient, although not strictly legal nor definite. This has been held in the case of a sister dependent on a brother for support; and the rule would be held to apply not only to all relations, but where there was no relationship, if there were a positive and real dependence. That is, any one may insure a sum on the life of any other person on whom he or she really depends for support or for comfort. And generally, it is said to be enough, if, according to the ordinary course of events, pecuniary loss or disadvantage will naturally and probably result from the death of the one whose life is insured.

So an existing debt gives the creditor an insurable interest in the life of a debtor. But if the debt be not founded on a legal consideration, it does not sustain the policy. And if the debt be paid before the death of the debtor, the insurers are discharged.

SECTION V.

THE ASSIGNMENT OF A LIFE-POLICY.

LIFE-POLICIES are assignable at law, and are very frequently assigned in practice. And the assignee of a policy is entitled on the death of the party insured, to recover the full sum insured without reference to the amount of the consideration paid by him for the assignment. A large proportion of the policies which are effected are made for the purpose of assign. ment; that is, for the purpose of enabling the insured to give

this additional security to his creditor. If the rules of the company or the terms of the policy refer to an assignment of it, they are binding on the parties. On the one hand, an assignment would operate as a discharge of the insurers, provided a rule or expressed provision gave this effect to the assignment. And, on the other, if the agreement were that the policy should continue in favor of the assignee, even after an act which discharged it as to the insured himself,-as, for example, his suicide,-the insurers would be bound by it.

It is an important question what constitutes an assignment. The general answer must be, any act distinctly importing an assignment. And, therefore, a delivery and deposit of the policy, for the purpose of assignment, will operate as such, without a formal written assignment. So will any transaction which gives to a creditor of the insured a right to payment out of the insurance.

It seems, however, that delivery is necessary. And where an assignment was indorsed on the policy, and notice given to the insurer, but the policy remained in the possession of the insured, it was held that there was no assignment. Where, however, the assignment is by a separate deed, which is duly executed and delivered, this is an assignment of the policy, without actual delivery of the policy itself.

SECTION VI.

WARRANTY, REPRESENTATION, AND 'CONCEALMENT.

THE general principles on this subject are the same which we have already stated in reference to other modes of insurance. In life-policies, however, the questions which must be answered are so minute, and cover so much ground, that difficulty seldom arises except in relation to the answers. One advisable precaution is for the answerer to discriminate carefully between what he knows and what he believes. If he says simply "yes" or "no," or gives an equivalent answer, this is in most cases a strict warranty, and avoids the policy if there be any material mistake in the reply. But where the answerer adds the words "to the best of my knowledge and belief," he warrants only the

fact of his belief, or, in other words, nothing but his own entire honesty.

The cases which turn upon the answers to the questions are very numerous; but they necessarily rest upon the especial facts of each case, and hardly permit that general rules should be drawn from them. Some, however, may be stated.

The first is, that perfect good faith should be observed. The want of it taints a policy at once, and the presence of it goes far to protect one. Thus, where the life-insured was beginning to be insane, but was wholly unconscious of it, the policy was not vitiated by the concealment, although two doctors in attendance upon him knew how the case stood.

Most of the policies of the present day provide that the policy is made on the faith of the statements in the application for insurance with the stipulation, and that, if they shali be found in any respect untrue, the policies shall be avoided Then the stipulations are considered as warranties, and if untrue, even in a point immaterial to the risk, avoid the policies.

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There is a warranty, or statement, usually making a part of nearly all life-policies; it is that the life insured is in good health. But this does not mean perfect health, or freedom from all symptoms or seeds of disease. It means reasonably good health, and loose as this definition, or rule, may be, it would be difficult to give it any other. And if a jury on the whole are satisfied that the constitution of one warranted to be "in good health" is radicaliy impaired, and the life made unusu ally precarious, there is a breach of the warranty, although no specific disease is shown which must have that effect. On the other hand, this warranty is not broken by the presence of a disease, if that be one which does not usually tend to shorten life (in one English case dyspepsia was said to be such a disease), unless it were organic, or had increased to that extreme degree as to be of itself dangerous.

Consumption is the disease which is most feared in. this country, as well as in England. And the questions which relate to the symptoms of it, as spitting of blood, cough, and the like, are exceedingly minute. But here also there must be a reasonable construction of the answers. Thus, if spitting of blood be posi.

tively denied, there may be no falsification in fact, though literally speaking the life-insured may have spit blood many times, as when a tooth was drawn, or from some accident. If there be an action on the policy, and the insurers rest their defence on any falsification of this kind, the question usually put to the jury is, Was the party affected by any of these or similar symp toms, in such wise that they indicated a disorder tending to shorten life? And any symptom of this kind, however slight,as a drop or two of blood having ever flowed from inflamed or congested lungs,-should be stated. Statements materially untrue on these points avoid the policy, although the insured, at the time of his application, did not believe that he had any pulmonary disease, and the statement made by him was not intentionally false, but, according to his belief, true.

The insurers always ask who is the physician of the lifeinsured that they may make inquiries of him if they see fit. And his name must be stated fully and accurately. It is not enough to give the name of the usual attendant; but every physician really consulted should be named, and every one consulted as a physician, although he is an irregular practitioner or quack.

If the warranty be that the life-insured is a person of sober and temperate habits, it has been held, in an action on such a policy, that the jury are not to inquire whether his habits of drinking are such as might injure his health; for if he has any "habits of drinking," this would discharge the insurers, because they have a perfect right to say that they will insure only those who are temperate. But it may be answered, that although the insurers have this right, and there may be good reasons why this should be the general practice, yet unless they use the word "abstinence," or something equivalent, they have no right to say that any one is not "temperate" who does not drink enough to affect his health; for as, generally, all intemperance must affect health injuriously, if there be no such injury, the presumption would be that there was no intemperance; and there is clearly a broad distinction between temperance and total absti

nence.

An answer, "not subject to fits," is not necessarily falsi.

fied by the fact that the life-insured has had one or more fits But if the question had been, "Have you ever had fits?" then it is said that any fit of any kind, and however long before, must be stated. But if a man had a fit when a young child, and forgot to mention it, or considered it wholly unimportant, and it had nothing to do with his state of health, it would hardly be held a falsification which would avoid the policy.

As there is always a general question as to any facts affecting health not particularly inquired of, a concealment of such a fact goes to a jury, who are to judge whether the fact was material, and whether the concealment were honest. As when a lifeinsured was a prisoner for debt, and so without the benefit of air and recreation, and this was not told; and where a woman whose life was insured had become the mother of a child under disgraceful circumstances some years before, and this fact was concealed, the plaintiff was non-suited.

If the policy, and the papers annexed or connected, put no limits on the location of the life-insured, he may go where he will. But if, when applying for insurance, he intends going to a place of peculiar danger, and this intention is wholly withheld, it would be a fraudulent concealment.

If facts be erroneously but honestly misrepresented, and the insurers, when making the policy, knew the truth, the error does not affect the policy. Nor does the non-statement of a fact which diminishes the risk.

If upon a proposal for a life insurance, and an agreement thereon, a policy be drawn up by the insurers and presented to the insured and accepted by them, which differs from the terms of the agreement, and varies the rights of the parties concerned, equity will interfere and deal with the case on the footing of this agreement, and not of the policy. But it may be shown by evidence and circumstances, that it was intended by the insurers to vary the agreement, and propose a different policy to the insured, and that this was understood by the insured, and the policy se accepted.

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