SECT. III. Of the usual Clauses and formal Requisites of the Of the usual Policy. In order to give the student a clearer knowledge of the contents of this instrument, we will consider in their order the common clauses which it usually comprises, and the main requisites in point of substance and form, which are essential to its validity as a contract. 1. The Names of the Assured or his Agent. clauses and formal requisites of the policy. not be in blank. § 18. The underwriter ought to know to whom he is to Policies must resort for payment of the premium; and should therefore be informed by the policy of the name of some party by whom or for whom it is effected. As the party to whom the underwriter actually gives credit for the premium is, in the usual course of business, the insurance broker, by whom the policy is, in most cases, actually effected; it is sufficient for the underwriter's purposes that the policy should be filled up either with the name of the broker by whose agency it is effected, or with that of the party really interested, on whose behalf the broker acts; but with the name of one or other of these parties the policy must be filled up, otherwise it is void. A policy in which the names of the parties by or for whom it is effected are not inserted is called a policy in blank, and is either prohibited by the laws, or rejected by the practice, of all mercantile states. In our own country the law in terms provides, that no 28 G. 3. c. 56. policy shall be effected without first inserting therein "the name or names, or the usual style and firm of dealing," either, 1. Of "one or more of the persons interested," or, 2. Of "the consignor or consignees of the property to be insured," or, 3. Of "the persons resident in Great Britain who shall receive the order for and effect the policy," or, Of the usual clauses and formal requi sites of the policy. 4. Of "the persons who shall give the order to the agent immediately employed to effect it." (p) The Courts of Law, as we shall have occasion to show more at length elsewhere, have held themselves bound to give this act the most liberal construction the words will bear; and, in consequence of this wise determination, the result of our English jurisprudence upon the subject has been, merely to render it necessary that the name of the person actually procuring the policy to be effected (i. e. in almost all cases of the insurance broker) should be inserted therein; so that the Act of Parliament, as interpreted by the judges, has been reduced to a mere prohibition against policies in blank. In practice, accordingly, the name usually inserted in the policy is that of the insurance broker, who insures either in his own name and on his own account, or in his own name and on account of his principals. In the first case the blanks marked number 1 and 2, in the printed form, are filled up thus: "A. B. & Co. (style of the insurance broker's firm), as well in their own names, as for and in the name and names of all and every other persons to whom the same doth, may, or shall appertain, in part or in all, do make assurance and cause themselves and them and every of them to be insured," &c. In the second case (which is the commonest form), the blanks are filled up thus : "A. B. & Co., as well in their own names, as for and in the name and names of all and every other persons to whom the same doth, may, or shall appertain, in whole or in part, do make assurance and cause C. D. & Co. (name, or firm of their employers, the parties interested), and them and every of them, to be insured," &c. If the party interested, himself effects the policy, without the intervention of a broker, he of course expresses himself to have so effected it in his own name and on his own account, as in the first form, merely substituting the name or style of the principal for that of the broker. (p) 28 Geo. III. c. 56. Such are the usual modes in which these blanks are filled up in English policies; in practice, some slight variation of form occasionally occurs; sometimes, for instance, it is stated on the face of the policy that the party effecting it does so "as agent for," or "at the request of" the principal; but these variations are immaterial. The party who has thus effected the policy on account of a principal is called "the nominal assured;" the principal himself, for whom it is effected, is called "the party interested.” 2. Of the Clause, " For and in the Names of all Persons to whom the same doth appertain, in part or in all." § 19. The insertion of this clause, which is invariably introduced into all our common printed forms of policy, is of great importance, as without it no one could take advantage of the policy except the party expressly named in it; but by the aid of this clause, as we shall have occasion to see more at large hereafter, any party may avail himself of the policy, who can prove that he was really interested in the subject matter of the insurance during the risk and at the time of loss; and that he was the person upon whose account the insurance was bonâ fide intended to be made. (2) 3. Of the Clause, "Lost or not lost." § 20. As policies are frequently effected, not only on ships and goods in our home ports, but on those also which are in foreign ports, or actually at sea on their way either to this or other countries, from foreign ports, and with regard to which it is, of course, uncertain whether they may not actually have been lost before the policy was effected, these words, "lost or not lost," are inserted in every form of policy as a matter of course. The clause, however, though never omitted, does not appear to be strictly necessary, as there can be no reason why a previous loss of the subject insured should prejudice an in (9) See post. Of the usual clauses and formal requisites of the policy. A policy with this clause af fords indemnity against all past as well as future losses. Unless, indeed, the fact of loss were known to the assured only, and not communicated by him to the underwriter. What is meant by the "de surance subsequently effected, if both the assured and the underwriters were equally ignorant of the loss at the time. (r) It has recently been decided that a policy containing this clause was good, where the subject of insurance was accepted for insurance, and the premium paid, before loss, although the policy was not executed until after a loss had happened, to the knowledge both of the assured and the underwriter. (s) A policy, indeed, containing this clause, as it has been remarked by Mr. Baron Parke, "is clearly a contract of indemnity against all past as well as all future losses sustained by the assured, in respect of the interest insured.” (t) Accordingly, where on a policy on goods "lost or not lost" the pleadings raised the question, whether it was any answer to an action on such policy that the plaintiff did not acquire an interest in the goods till after the loss, the court held that it was not. (u) Such a contract, they considered, "operated just in the same way as if the plaintiff, having purchased goods at sea, the defendant, for a premium, had agreed that if the goods, at the time of the purchase, had sustained any damage by the perils of the sea, he would make it good.” (v) If indeed the loss, at the time of effecting the policy, were known to the assured only, then, on the plainest general principles, the policy would be void; but no case has determined that an underwriter, who chooses to effect a policy with full knowledge that the loss has actually happened, may not be bound by it. (w) 4. Clause describing the Voyage insured. § 21. The underwriter cannot know the nature of the risk scription of the he is asked to insure, nor, consequently, the amount of voyage insured" in the policy. (r) See Marshall, Ins., p. 338-340. Allen, 2 Sumner's Rep., 397. (s) Mead v. Davison, 3 Ad. & Ell. p. 303. (t) Per Parke, B., in Sutherland v. Pratt, 11 Mees. & Wels., 311, 312. (u) Sutherland v. Pratt, 11 Mees, & Wels., 296. (v) Ibid. p. 312. (w) Per Lord Denman in 3 Ad. & Ell., p. 308. clauses and premium he ought to require, unless he knows the nature of Of the usual the voyage on which the ship is to sail, or the goods are formal requito be conveyed. It is therefore one of the most essential sites of the policy. requisites of a policy of insurance, that it should contain an accurate description of the voyage insured. By this is meant, not that it should describe the whole course of the voyage to be actually taken by the ship; the track which she is to pursue through the waters; the straits she is to pass; the islands which she is to leave on the one side or the other; the capes she is to double; the reefs and shoals she has to avoid :—all this, although very necessary to be known to the underwriter, is supposed to be so familiar to him from his acquaintance with the course of the trade and navigation which the insurance is designed to protect, that it is never expressly inserted in any policy, though it impliedly forms a part of all. All that is necessary to be expressed in the policy is the place or period at which the voyage insured is to begin, and the place and period at which it is to end, and which are called in technical language, the terminus a quo, and the terminus ad quem of the voyage insured, or of the risk. These termini must be expressed with great care and distinctness in the policy; and any failure herein will, as we shall see hereafter, have the effect of vitiating that instrument. (x) We shall here only mention, by way of explaining the language of the instrument, the distinction between insuring with the words "at and from" a place, and simply insuring "from" it. An insurance expressed in the policy to be "from A. to B." only protects the subject insured from the moment of the ship's sailing from A. (y): an insurance "AT and from" protects the subject insured from the first moment of the ship's arrival at A., and during her whole stay there. (z) As it is especially desirable, in cases where a ship is (x) Molloy, book ii. c. 11. s. 14., as cited by Marshall on Ins., p. 328. See also Syers v. Bridge, Dougl., 527. (y) Marshall on Ins., p. 260. The voyage need only be described in the policy by its termini. |