Insurance Policy in UK Law

An essential feature of insurance against fire is that it covers fires caused by accident as well as by negligence. This was what the plaintiffs agreed to provide in consideration of (inter alia) the insurance rent paid by the defendants.

It has long been accepted that this is not a literalist exercise focused solely on a parsing of the wording of the particular clause but that the court must consider the contract as a whole and, depending on the nature, formality and quality of drafting of the contract, give more or less weight to elements of the wider context in reaching its view as to that objective meaning.

Moreover, if the underlying contract envisages that one co-assured may be liable to another for negligence even within the sphere of the cover provided by the policy, I am inclined to think that there is nothing in the doctrine of subrogation to prevent the insurer suing in the name of the employer to recover the insurance proceeds which the insurer has paid in the absence of any express ouster of the right of subrogation, either generally or at least in cases where the joint names insurance is really a bundle of composite insurance policies which insure each insured for his respective interest.

It may well be that, when two persons are jointly insured and their interests are inseparably connected so that a loss or gain necessarily affects them both, the misconduct of one is sufficient to contaminate the whole insurance ( Phillips on Marine Insurance, vol.

He is under a disability precluding him from imposing a claim. This difference is important, because if the policy of insurance should come, by assignment or otherwise, into the hands of a person who is not affected by the disability, then such a person can enforce the policy according to its terms, see Cleaver v. Mutual Reserve Fund Life Association, 1892, 1 Queen's Bench, p. 147, and Beresford v. Royal Insurance Co., 1938 Appeal Cases at p. 600.

Under the section it is clear to me that the injured person cannot sue the Insurance Company except in such circumstances as the insured himself could have sued the Insurance Company. The insured could only have sued for an indemnity when his liability to the third person was established and the amount of the loss ascertained. In some circumstances the insured might sue earlier for a declaration, e.g. if the insured company were repudiating the policy for some reason.

It is quiteunheard of in practice for any assured to sue his insurers in a money claim when the actual loss against which he wishes to be indemnified has not been ascertained, I have never heard of such an action and there is nothing in law that makes such an action possible.