come, and the only unDalby v. London Ass. however, life insurance Where, for instance, a

policies. In policies for life, the loss is sure to certain element is the date when it will come. Co., 15 C. B. 365. In some of its forms, seems to be clearly a contract of indemnity. creditor insures the life of his debtor, he is thereby indemnified against the loss of his debt which may follow his sudden death. In such case, where the debtor has paid the premiums, the debtor is entitled to claim the policy when the debt is paid. Knox v. Turner, L. R., 9 Eq. 155. In other cases, as where the life of a husband is insured for the benefit of his wife, it is also an indemnity to her for a loss, which may have in it an unliquidated pecuniary element. This is more evident, when, as often in England, it is made a covenant in the marriage settlement that the intended husband shall insure his life. The same considerations apply with less force perhaps in other cases of insurance between relatives. In ordinary policies of life insurance, the damages resulting are unliquidated, at the same time danger of fraudulent loss is much diminished, being almost confined to the offering for insurance of bad lives. Therefore it is more assimilated to other commercial transactions, like the deposit of savings, or the discount of notes. A man purchases, for a certain sum, a bill, by which he is entitled to be repaid a larger sum at a fixed future time. He deposits a certain sum with the hope of drawing a larger sum at some uncertain future time. He pays a premium and thereby purchases a contract by which he is to be paid a certain sum at an uncertain time. In case of what are called endowment policies of life insurance, this is still more evident, where a young man takes an endowment policy on a short term, the only element of chance is the contingency of his dying during the term and the indemnity, for that forms but a very small share of the premium.

§ 2. Insurable interest. It is essential that the insurer should have an interest in the life of the person insured. Guardian Ins. Co. v. Hogan, 80 Ill. 36; Franklin Ins. Co. v. Sefton, 53 Ind. 380. But this, like all other principles, is to be construed with reference to the objects for which it is established. It is founded on the repugnance of the law to wagering or gambling contracts, in other words, those by which the person contracting may acquire gain without the risk of some proportionate loss. It would at first seem difficult to see how a person can have an insurable interest in his own life, for the contract affords no compensation to him. But such policies must rather be considered as resting upon the interest which his representatives have in his life. Provident Ins. Co. v. Baum, 29 Ind. 236. Where some other person than the insured makes the contract, in order to support it some direct interest must be proved, for else it would not only be a

wagering contract, but an impertinent interference with a third party, on whose life the contractors would put a price. What the required interest is, will be illustrated by the following decisions. Where a young woman was without property and had been supported and educated by her brother, who stood to her in loco parentis, and whose death would have left her destitute, and he was about to go to South America, it was held that she could insure his life for her own benefit. Lord v. Dall, 12 Mass. 115. The interest must be a pecuniary one, otherwise the loss could not be made good by money. Halford v. Kymer, 10 B. & C. 725. If a son is a minor, who can render service, and to whom advances have been made, his father has an insurable interest. Mitchell v. Union Ins. Co., 45 Me. 104. In Loomis v. Eagle Ins. Co., 6 Gray (Mass.), 396, the court go further and say, we cannot doubt that a parent has an interest in the life of a child and vice versa a child in the life of a parent, not merely because they are bound to support their lineal kindred when in need of relief, but upon considerations of strong morals and the force of natural affections between near kindred, operating more efficaciously than those of positive law. Reserve Ins. Co. v. Kane, 81 Penn. St. 154; Hoyt v. N. Y. Ins. Co., 3 Bosw. (N. Y.) 440; Miller v. Eagle Ins. Co., 2 E. D. Smith (N. Y.), 286; contra, Guardian Ins. Co. v. Hogan, 80 Ill. 35. A wife has sufficient interest in the life of her husband, and divorce will not deprive her of her insurance. McKee v. Phænix Ins. Co., 28 Mo. 383. So even of a woman not married, but living with a man as his wife and treated and supported as such. Equitable Ass. Soc. v. Patterson, 41 Ga. 338; 5 Am. Rep. 535. So a woman under contract of marriage has an interest in the life of her intended husband. Chisholm v. National Capital Ins. Co., 52 Mo. 213; 14 Am. Rep. 514. A creditor has an interest in the life of his debtor. Anderson v. Edie, cited in Park on Ins. 432. Even if the debt is one which is voidable (id.) or to which the statute of limitations may be pleaded as a bar. Rawls v. American Ins. Co., 36 Barb. (N. Y.) 357; S. C., 27 N. Y. (13 Smith) 282; Mowry v. Home Ins. Co., 9 R. I. 346. So where a partnership is formed, money being placed against skill, in dividing the profits, the partners advancing money may insure the other partner's life. Valton v. National Loan Fund Ass. Soc., 22 Barb. (N. Y.) 9; S. C., 20 N. Y. (6 Smith) 32. Of the same nature is a loan to start another in business, with a promise of repayment with profits. Bevin v. Conn. Ins. Co., 23 Conn. 244; Morrell v. Trenton Ins. Co., 10 Cush. (Mass.) 282; Trenton Ins. Co. v. Johnson, 24 N. J. 577. A servant has an insurable interest in the life of his master who has employed him for a fixed term (Hebdon v. West, 3 Best & Sm. 578);

and master in the life of his servant. Miller v. Eagle Ins. Co., 2 E. D. Smith (N. Y.), 268. A promise by a creditor that a debt shall not be called for while he lives does not give the debtor an insurable interest. Hebdon v. Best, 3 B. & S. 578. A policy cannot be assigned to one who has no interest. Franklin Ins. Co. v. Sefton, 53 Ind. 380; contra, Valton v. Nat. Life Ass., 20 N. Y. (6 Smith) 32.

§ 3. Warranty. A warranty is a condition precedent, and its terms must be strictly complied with. Barteau v. Phoenix Ins. Co., 67 N. Y. (22 Sick.) 595. It lies at the base of the contract, and the insured can recover only when he has fulfilled its conditions. Any statement upon the literal truth or fulfillment of which the validity of the contract depends, is a warranty. The parties may make any statement a warranty, even if it is of no importance. Yet, its importance is an element in determining what the meaning is. O'Niel v. Buffalo Ins.

Co., 3 Comst. (N. Y.) 122.

The whole contract is to be construed together. Campbell v. N. E. Ins. Co., 98 Mass. 381; Price v. Phoenix Ins. Co., 17 Minn. 497; 10 Am. Rep. 166. The courts will endeavor to construe the policy so that it may be supported by a substantial compliance with its provisions. Thus where an inquiry is made whether the applicant has suffered any serious injury, it will be held to refer not to the pain caused by it, but to its effect on the applicant's health at the time of insurance. Union Ins. Co. v. Wilkinson, 13 Wall. (U. S.) 222; Higbee v. Guardian Ins. Co., 66 Barb. (N. Y.) 462. If, however, he answers untruly any question where the answer is made a warranty, as by denying that he has had a disease named (Barteau v. Phonix Ins. Co., 1 Hun [N. Y.], 430; 3 N. Y. Sup. [T. & C.] 576; Foot v. Ætna Ins. Co., 4 Daly [N. Y.], 285; 61 N. Y. [16 Sick.] 571; Vose v. Eagle Ins. Co., 6 Cush. [Mass.] 72); or denying that he had a family physician (Monk v. Union Ins. Co., 6 Robt. [N. Y.] 455); the question arises as to his belief or the materiality of the matters inquired about, but the policy is void. Mutual Benefit Ins. Co. v. Cannon, 48 Ind. 264; Anderson v. Fitzgerald, 4 H. L. Cas. 484. It will not help the insured that he was entirely ignorant of the disease. Duckett v. Williams, 4 Tyrw. 240. Where the warranty is that the insured has had no disease, it may be for the jury or the court to decide the validity of the policy, for not every slight indisposition is, as matter of law, a disease. Life Ins. Co. v. Francisco, 16 Wall. (U. S.) 672. Severe sickness does not refer to the ordinary diseases of the country which readily yield to medical treatment. Southern Ins. Co. v. Wilkinson, 53 Ga. 535; Boos v. World Ins. Co., 64 N. Y. 236. not imply absolutely perfect health.

So, "in good health" does Peacock v. N. Y. Ins. Co.,

20 N. Y. 293. A mere statement of the occupation of the insured is not a warranty. Providential Ins. Co. v. Fennell, 49 Ill. 180; Perrins v. Gen. Travelers' Ins. Co., 2 El. & El. 317.

§ 4. Representations. A representation is a statement incidental to the contract, upon the faith of which the contract is entered into. If false and material to the risk, it avoids the contract. Mutual Benefit Ins. Co. v. Miller, 39 Ind. 475. It differs from a warranty in that a less strict compliance with its terms by the insured is required. Higbee v. Guardian Ins. Co., 66 Barb. (N. Y.) 462; 53 N. Y. (8 Sick.) 603. But even if made by mistake and in good faith, a breach avoids the policy. The policy, however, often calls only for good faith and then error will not avoid it. The misrepresentation must be material. Barteau v. Phoenix Ins. Co., 67 N. Y. (22 Sick.) 595. The parties may decide in the contract what is material. The question of the truth of the statement will ordinarily be for the jury. Thus, where the applicant in answer to a question whether he had had rheumatism, or had had any severe sickness, said that he had not and it was proved that he had had subacute rheumatism, and gastritis, it was left to the jury to determine whether the answers were true. Price v. Phanix Ins. Co., 17 Minn. 497; 10 Am. Rep. 166. So if the question be, whether he is employed in the military service, the jury must decide whether the facts show such an employment; or whether he has had any sickness, they may determine whether the facts proved amounted to sickness, as understood by the parties. But they cannot consider whether the matters inquired about are material. Mutual Benefit Ins. Co. v. Wise, 34 Md. 583. The representation must continue true up to the time when the contract is closed. Any change in the health or circumstances of the parties during the negotiations which would naturally have an influence on the insurers to deter them from making the contract must be disclosed. Rose v. Med. Ins. Co., 11 Ct. of Sess. (S. C.) 2d Ser. 345. Such for instance as a change from a mild to a severe type of disease. Brady v. N. W. Ins. Co., 11 Mich. 425. If the representation is true when the bargain is closed, a subsequent change is immaterial. Reichard v. Manhattan Ins. Co., 31 Mo. 518; Benham v. United Guaranty Ass. Co., 7 Exch. 744. If the insurer desires to have any control over such matters, he must make them a part of the contract. If a written application be made, proof of verbal statements will be excluded. Rawls v. American Ins. Co., 27 N. Y. (13 Smith) 282. If the parties have not in the contract determined the question of the materiality of the representation, it may be a ques tion for the jury to determine from the circumstances. Thus, representations as to the pecuniary means or social or business relations of the

insured may be material if they influenced the insurers, as that he was a partner and the moneyed man of a firm, to the other alleged members of which he assigned the policy. Valton v. National Loan Fund Ass. Soc., 20 N. Y. (6 Smith) 32. Whether a false representation that the party had no other insurance on his life was material, was left to the jury. Wainewright v. Bland, 1 M. & R. 481; S. C., 6 Tyrw. 417. Where the statement is that the applicant never used opium, liquor or tobacco, their use as medicines does not make the representation false. Higbee v. Guardian Ins. Co., 66 Barb. 462; 53 N. Y. (8 Sick.) 603. A verbal statement on receiving a renewal receipt is a mere representation and does not make the policy void, unless it is material and induced the continuance of the policy. Mutual Benefit Ins. Co. v. Robertson, 59 Ill. 123; 14 Am. Rep. 8. The burden of proving the answers to the insurer's questions untrue, is upon the insurer. Piedmont Ins. Co. v. Ewing, 92 U. S. 377; Jones v. Brooklyn Ins. Co., 61 N. Y. 79. Where it was stipulated in the application that the answers were fair and true, that they should form the basis of the contract, that if any of them were untrue or fraudulent they should avoid the policy, they were material representations, not warranties. Price v. Phoenix Ins. Co., 17 Minn. 497; 12 Am. Rep. 166. It is for the jury to determine whether there has been a substantial compliance with the representations or whether they are substantially true. Miller v. Mutual Benefit Ins. Co., 31 Iowa, 216; 7 Am. Rep. 122; Mu tual Benefit Ins. Co. v. Wise, 34 Md. 582. Thus the jury passed upon the question whether a certain disease was bronchitis (Campbell v. N. E. Ins. Co., 98 Mass. 381), or whether another disease was rheumatism, or whether it constituted a severe sickness. Price v. Phonix Ins. Co., 17 Minn. 497; 10 Am. Rep. 166. It is enough if the jury find the representation to be substantially, though not literally, true. N. A. Ins. Co. v. Throop, 22 Mich. 146; 7 Am. Rep. 638; Higbee v. Guardian Ins. Co., 66 Barb. (N. Y.) 462; 53 N. Y. (8 Sick.) 603; Buford v. N. Y. Ins. Co., 5 Oreg. 334. A comparison of the different parts of the policy may reduce what would otherwise be a warranty to a representation. Thus where a statement is required to be true, but the form given is a statement to the best of the applicant's belief, or it is afterward provided that the fraudulent statements shall make the policy void, it is a representation. Fowkes v. Manchester Ass. Co., 3 F. & F. 440; Washington Ins. Co. v. Harney, 10 Kans. 525. Though the false answers are inserted by the fraud of the agent, the policy is still void. Ryan v. World Ins. Co., 41 Conn. 168; 19. Am. Rep. 490; contra, Rockford Ins. Co. v. Nelson, 75 Ill. 548.