Section 26. Construction. Although Fire Insurance Policies, Like All Other Forms Of Contracts, Are To Be Construed According To The Intention Of The Parties, Still All Doubts Will Be Construed In Favor Of The Insured. This Applies Even In The Case Of Standard Policies, I. E. Policies Which Are Fixed By State Statutes.7 The Reason For This Favor Shown To The Insured Is On Account Of The Opportunity Afforded To Insurance Companies To Take Advantage Of The Insurer By Inserting Ambiguous Terms Which Will Bear Very Heavily On The Insurer
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This section is from the book "Popular Law Library Vol9 Bills And Notes, Guaranty And Suretyship, Insurance, Bankruptcy", by Albert H. Putney. Also available from Amazon: Popular Law-Dictionary.
Section 26. Construction. Although Fire Insurance Policies, Like All Other Forms Of Contracts, Are To Be Construed According To The Intention Of The Parties, Still All Doubts Will Be Construed In Favor Of The Insured. This Applies Even In The Case Of Standard Policies, I. E. Policies Which Are Fixed By State Statutes.7 The Reason For This Favor Shown To The Insured Is On Account Of The Opportunity Afforded To Insurance Companies To Take Advantage Of The Insurer By Inserting Ambiguous Terms Which Will Bear Very Heavily On The Insurer
7 "The act (Chapter 488, Law 1886), providing for a uniform policy known as the 'standard policy' and which makes its use compulsory upon insurance companies, marks a most important and useful advance in legislation relating to contracts of insurance. The practice which prevailed before this enactment, whereby each company prescribed the form of its contract, led to great diversity in the provisions and conditions of insurance policies, and frequently to great abuse. Parties taking insurance were often misled by unusual clauses or obscure phrases concealed in a mass of verbiage and often so printed as to elude discovery. Unconscionable defenses, based upon such conditions, were not infrequent, and courts seem sometimes to have been embarrassed in the attempt to reconcile the claims of justice with the law of contracts. Under the law of 1886, companies are not permitted to insert conditions in policies at their will. The policies that they now issue must be uniform in thier provisions, arrangement and type. Persons seeking insurance will come to understand to a greater extent than heretofore the contract into which they enter. Now, as heretofore, it is competent for the parties to a contract of insurance, by an agreement in writing or by parol, to modify the contract after the policy has been issued, or to waive conditions or forfeitures. The power of agents, as expressed in the policy, may be enlarged by usage of agents, its course of business, or by its consent, express or implied. The principle that courts lean against forfeitures is unimpaired, and in weighing evidence tending to show a waiver of conditions or forfeitures the courts may take into consideration the nature of the particular condition in question, whether a condition precedent to any liability or one relating to the remedy merely, after a loss has been incurred. But where the restrictions upon an agent's authority appear in the policy and there is no evidence tending to show that his powers have been enlarged, there seems to be no good reason why the authority expressed should not be regarded as the measure of his power; nor is there any reason why courts should refuse to enforce forfeitures plainly incurred, which have not been expressly or impliedly waived by the company." Quinlan vs. Ins. Co., 133 N. Y., 356; 31 N. E., 31.
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