1 Postlethw. Dict. of Tr. Vide the No. 3. 459. CHAPTER XXII. Of Insurance upon Lives. AN insurance upon life is a contract, by which the under writer for a certain sum, proportioned to the age, health, profession, and other circumstances of that person, whose life is the object of insurance, engages that the person shall not 2 Blac. Com. die within the time limited in the policy: or if he do, that he will pay a sum of money to him in whose favour the policy was granted. Thus if A. lend 100l. to B., who can give nothing but his personal security for repayment: in order to secure him in case of his death, B. applies to C. an insurer, to insure his life in favour of A., by which means, if B. die within the time limited in the policy, A., will have a demand upon C. for amount of his insurance. I Postlethw. 150. The advantages resulting from such insurances are many and obvious and most of them may be reduced under the following classes. To persons possessed of places or employments for life; to masters of families, and others, whose income is subject to be determined, or lessened, at their respective deaths: who, by insuring their lives, may secure a sum of money for the use of their families. To married persons, where a jointure, pension, or annuity, depends on both or either of their lives, by insuring the life of the persons entitled to such annuity, pension, or jointure. To dependants upon any other person, during whose life they are entitled to a salary or benefaction, and whose life being insured, will enable such dependants, at the death of their benefactor, to claim from the insurers a sum equal to the premium paid. To persons wanting to borrow money, who, by insuring their lives, are enabled to give a security for the money borrowed. These, and many other advantages, being so obvious, the Bishop of Oxford, Sir Thomas Allen, and some other gentlemen, were induced to apply to Queen Anne to obtain her charter for incorporating them and their successors, whereby they they might provide for their families, in an easy and beneficial manner. Accordingly, in the year 1706, Her Majesty granted her royal charter, incorporating them by the name of "The "Amicable Society for a perpetual Assurance Office," giving them a power to purchase lands, an ability to sue and be sued in their corporate capacity, and a common seal for the more easy and expeditious management of the affairs of the Company. The benefits, which accrued to the public from this species of contract, were found to be so extensive, that another office was established by deed enrolled in the Court of King's Bench at Westminster, for the insurance of lives only. The name of this office is the "Society for equitable Assurance on Lives and "Survivorships." Besides this, the two Companies of the Royal Exchange and London Assurance, obtained His Majesty's charter, to enable them also to make insurance on lives. The charter points out the advantages of such institutions; for it states as the ground, on which such a permission is to be granted, "That it has been found by experience to be of "benefit and advantage, for persons having offices, employments, estates, or other incomes, determinable on the life or "lives of themselves or others, to make assurances on the life "or lives, upon which such offices, employments, estates, or "incomes are determinable." (a) Private underwriters also 66 (a) An act passed in the 39 Geo. 3. (ch. 83.) for incorporating a new insurance company, called The Globe Insurance Company, the second section of which authorizes them (among other things) to make insurances on the life or lives of any person or persons whomsoever; and to grant, purchase, and sell annuities for lives, or on survivorship, and grant sums of money, payable at future periods, within the kingdom of Great Britain or Ireland, and any other parts abroad, whether within His Majesty's dominions or not; and shall and may receive deposits of funds of tontine societies, and other institutions established for granting future advantages, and deposits of funds belonging to, and act as treasurer thereof for benefit or friendly societies, and other charitable and benevolent institutions; and make provision for the widows and children of the clergy, and for clergymen, and receive deposits from or on account of members of the industrious classes of society, and others; and to make provision for members of the industrious classes of society, and others, by allowing interest on such deposits made, or otherwise, upon such terms and conditions, and in such manner, as shall or may be agreed upon between the said corporation so to be created and established, and the persons and societies treating with the said corporation, for the purposes thereinbefore mentioned. may enter into policies of this nature, as well as any other, provided the party making the insurance, chooses to trust their single security. The antiquity of this practice cannot be very easily ascertained; however, we find traces of it in some very old authors. In the French book, entitled Le Guidon, we find it mentioned, as a contract perfectly well known, at that time, in other countries. The author of that book, however, tells us in the same passage, that it was a species of contract wholly forbid den in France, as being repugnant to good morals, and as opening a door to a variety of frauds and abuses. Such, indeed, the law of France continues at this day: and insurances upon lives are prohibited in other countries of Europe by positive regulation. The same French author has, however, gone a little too far in asserting, that the other countries, in which they had been till that time encouraged, were also obliged to forbid them. This had not certainly taken place at that time, as may be inferred from the 66th article of the laws of Wisbuy: and in England they never had been prohibited. The learned Roccus also takes notice of them as legal contracts, and quotes various authors in support of his opinion. These insurances being thus sanctioned in England by royal authority, and the funds of the different societies having very much increased, and being fixed on a stable and permanent I Mag. 33. foundation, contracts of this nature became so much a mode of gambling, (for people took the liberty of insuring any one's life, without hesitation, whether connected with him, or not, and the insurers seldom asked any question about the reasons, for which such insurances were made,) that it at last became a subject of parliamentary discussion. The result of that discussion was, that a statute passed, by which it was enacted, "That no insurance should be made by any person or per 14 Geo. 3. c. 48.8. I. 66 66 sons, bodies politick or corporate, on the life or lives of any person or persons, or on any other event or events what66 soever, wherein the person or persons, for whose use, be"nefit, or on whose account, such policies should be made, "should have no interest, or by way of gaming or wagering; "and every insurance made contrary to the true intent and " meaning 66 66 "meaning thereof, should be null and void to all intents "and purposes." And in order more effectually to guard against any imposition or fraud, and to be the better able to ascertain, what the interest of the person, entitled to the benefit of the insurance, really was, it was further enacted, by the same statute," that it should not be lawful to make any Sect. 2. policy or policies on the life or lives of any person or per"sons, or other event or events, without inserting in such "policy or policies, the person's name interested therein, or "for whose use, benefit, or on whose account, such policy "was so made or underwrote. And that in all cases where Sect. 3"the insured had an interest in such life or lives, event or events, no greater sum should be recovered, or received "from the insurer or insurers, than the amount or value of "the interest of the insured, in such life or lives, or other “event or events. That nothing in the act contained shall Sect. 4. "extend, or be construed to extend, to insurances bonâ fide "made by any person or persons, on ships, goods, or mer"chandizes; but every such insurance shall be as valid and "effectual in law, as if this act had not been made.” 60 It has been held that a person, holding a note given for money won at play, has not an insurable interest in the life of the maker of the note. 1788. An action was brought on a policy on the life of James Rus- Dwyer v. Edie, Lond. sell from the 1st of June 1784 to the 1st of June 1785. Russell Sittings, was warranted in good health, and by a memorandum at the after Hil foot of the policy it was declared that it was intended to cover the sum of 5000l. due from Russell to the plaintiff, for which he had given his note payable in one year from the 14th of May 1784.-Two objections were made on the part of the defendant: 1st, That part of the consideration for the note was money won at play: 2dly, That Russell at the time he gave the note was an infant. Mr. Justice Buller nonsuited the plaintiff upon the ground of part of the consideration of the note being for a gaming transaction; and therefore there was a want of interest in the plaintiff. But as to the other objection on account of infancy the interest must be contingent, for Russell might or might not avoid TT 4 Anderson v. die, B. R. Lond. Sitt. in Trinity Term,1795. Tidswell v. Angerstein, avoid his note; and he doubted much whether till so avoided, the note must not be taken against a third person to be the note of an adult, for the maker of the note only could take the objection. (a) But a creditor has such an interest in the life of his debtor, that he may insure it, and recover upon the policy. Thus in an action on a policy of insurance on the life of Lord Nexhaven from the 1st December 1792 to the 1st of December 1793, the only question made by the defendant was as to the plaintiff's interest, which it was contended was not sufficient to take this case out of the statute 14 Geo. 3. c. 48. It appeared in evidence that Lord Newhaven was indebted to the plaintiff and a Mr. Mitchell in a large sum of money, part of which debt had been assigned by them to another person; the remainder, being more than the amount of the sum insured, was upon a settlement of accounts between the plaintiff and Mitchell, agreed by them to remain to the account of Mitchell only. Lord Kenyon was of opinion, that this debt was a sufficient interest and said, that it was singular, that this question had never been directly decided before. That a creditor had certainly an interest in the life of his debtor; the means by which he was to be satisfied may materially depend upon it, and at all events the death must in all cases in some degree lessen the security. Verdict for the plaintiff. So also in a previous case, where an action was brought on Peake's a policy on the life of William Holden from the 17th August 1790 to August 1791, and during the life of the plaintiff, Holden had granted an annuity to the plaintiff's late brother, N. P. Cases, 151. Cowp. 737. Mollison v. Staples, Sitt. at Guildhall, Mich. Vac. 1778. (a) There is a case of Roebuck v. Hammerton, in which a policy made, in order to decide upon the sex of a particular person, was held to fall within the prohibition of this statute. In another case, a policy having been made, on the event of there being an open trade between Great Britain and the province of Maryland, on or before the 6th of July 1778, Lord Mansfield said, that it was clear the plaintiff could not recover. 1st, Is this an interest within the act? It was made to prevent gambling policies. Every man in the kingdom has an interest in the events of war and peace; but I doubt whether that be an interest within the act. But 2dly, The policy is void, by not having the name inserted according to the second section of the statute. |