INSURANCE POLICIES

Dominion, Volume 19, Issue 257, 14 July 1926, Page 8

INSURANCE POLICIES

COMPANIES MUST NOT EXCEED PROPOSALS JUDGE’S IMPORTANT RULING By 'Lcefgrafh.—Press Association Auckland, July 13. Tn the Supreme Court to-day, Mr. Justice Stringer gave judgment for the full amount claimed in the action for the recovery of £49 14s. 3d. due on an insurance policy, brought by Albert Edward Braund against the Mutual Life and Citizens’ Assurance Company Plaintiff was a mechanical engineer who took out a combined life and accident policy for £lOO on October 10. When be was disconnecting a crank shaft on May 29, plaintiff, suffered .an injury which developed into hernia. Hr claimed compensation and the company denied liability. Plaintiff alleged that the policy Issued bv the company departed from the proposal by introducing fresh terms, but made no claim for rectification of the police. At the hearing, however, Mr. Justice Stringer granted an amendment, by adding a claim for rectification of the policy to make it conform to the proposal with regard to ininries bv accident. The defence, said His Honour, was, first, that there was no liability under the policy; second, that notice of the accident was not given “forthwith, but there being no doubt that the claim was a perfectly genuine one the technical defence was very properly withdrawn. One condition of the police was that the company was not. liable “for hernia however caused.” This provision contained thirty lines of exceedingly small print most difficult to read, an enumeration of a great variety of accidents in respect to which the comnany exempts itself from liability. This was an entire departure from tlie proposal, which contained no intimation of any such exemptions and purported to cover accidents generally and was so understood bv plaintiff His Honour was satisfied of the truth of plaintiff’s statement that he did not know the meaning of the word "her nin.” Tf he had read the clause in onestion, be would have understood its effect in limiting his rights' under the assurance? Tt was the duty of companies, added His Honour to make a police accord with and not exceed a proposal and to express both in clear and unambign ous terms The police would be rectified. as before mentioned and on such ' rect-fiention nlaintiff was entitl ed to the amount claimed, with costs on the lowest scale, witness’s expen ses mid disbursements