The most important point to remember is that it is the duty of the insured to observed good faith towards the insurers when an insured to observed perils operates as also during the currency of the policy. It is to be appreciated that it is not mere occurrence of the perils insured but the suffering of a loss that entitles the insured to claim a loss under the policy and if the insured sustains a loss in the performance of these duties . according to one legal authority any expenses incurred by the insured in extinguishing the fire or in removing the property insured. The preceding paragraphs outline the duties of the insured on the happening of an insured perils in general .
A building may be so damaged by fire or storm explosion as to render it unsafe for occupancy or dangerous to as to render it unsafe for occupancy or entry or dangerous to adjacent property or to street traffic . if fire or any other has damaged the roof of the building there may be further damage to the contents of the building by rain. The roof then may have to be covered by tarpaulin or it even be necessary to execute temporary repairs to minimize the loss.
Similarly household contents personal property may be exposed to damage by flame heat smoke or water or rain. In serious damage to machinery caused by fire explosion flood etc. such property is further exposed to damage by rust clogging of the machines by the stocks in process . the other important duties of the insured are to give notice of loss and prepare and present claims. it is the duty of the insured to give notice of loss for which intends to claim . the notice need not be in writing it may be verbal by telephone or personal call. At any rate the courts have tended to hold that if notice is given within a reasonable time. The insured is required to make a declaration on oath or in other legal form of the truth of thee claim and of any matters connected therewith.
RIGHTS OF INSURERS
Under common law insurers have certain powers and rights which correspond to the duties imposed on the insured to take all reasonable steps to exposed on the insured to take all reasonable steps to extinguish the fire to diminish it is equally important not only to the insurers themselves but also to the body of the insuring public that insurers should make a complete investigations both into the details of the claim no into the circumstances of the salvage as also the premises until investigation is complete. If the insured shall not in any case be entailed to abandon any property to the company whether taken possession of by the company o r not.
MISCELLANEOUS LEGAL ASPECTS
The acknowledge of a payment by the insured on a form of receipt or the completion by him of an agreement to receive the sum agreed either the assessors in full discharge of the claim. The agreement also binds the insured. the agreement also blinds the insurers and only on grounds of fraud van they refuse to priced to payment . an offer of payment is subject to the ordinary rule if refused the offer lapses and the insurers are then free to take any course they wish even to a denial of liability .
PAYMENTS TO PRESONA OTHER THAN THE INSURED
The insurer will require any person ether than the insured who claim to be entailed to payment under the policy to produce his credentials as for example in the case of an executor probate of the deceased’s will.
APPLICATION OF INSURANCE MONEYS
The insured on being paid the amount of his claim may in the ordinary way apply it as he wishes subject to any assignment of the proceeds and subject to any contract relating to effecting on behalf of others. Even where there is no contract between the parties if the insured at the time of effecting the policy intended to cover not only his own interest in the subject matter of insurance , but also the interest of the person claiming to share in the proceed the insured is in the position interest but only to the extent of the balance after recouping his own loss.
PAYMENT BY MISTAKE
While money paid in mistake of law is not as a general rule recoverable money paid in mistake of fact is general recoverable clearly if insurers knowing all the facts make a payment they cannot claim to have made a mistake of fact but mistake occur if they did not know and had no opportunity of knowing that certain conduct of the insured had entailed them to avoid the policy or the insurers waive enquiry and make a payment without reference was made excreta.
Disagreement may arise between the insurer and the insured concerning a claim and in certain circumstances such a depute may give rise to legal proceedings.
1) the existence of the contract
2) The validity of the policy
3) The liability of the insurer to meet the claim
4) The amount of the insurer liability
ASSIGNMENT OF CLAIM PROCEEDS
Apart from the assignment of the subject or of the policy the insured sometimes wishes to transfer to a third party the ensured sometimes wishes to transfer to a third party the amount payable or alleged to be payable under a policy when a claim arises. This assignment of the proceeds of the policy may be made either before or after the occurrence of the claim and no objection can be raised by the insurer.th eight so assigned is a chose In action and the transfer I subject to the ordinary rules governing the assignment of chooses in action.
The payment of a loss under a policy reduces the sum ensured by the amount of the loss paid and as there is any balance under his policy until the whole sum insured has been exhausted. The insurers during the currency of the policy cannot be called upon to pay more than the sum insured during the term of the insurance unless of course the insured pays an extra premium to reinstate the sum insured after payment of a loss is made.
CONSTRUCTION OF POLICIES
A policy of insurance is a document intended to have legal effects disputes sometimes arise as to the interpretation or the construction of a policy. The object of construction as expressed in the contract floor the contract is the parties as expressed in the contract for the contract is the final form in which the original intentions of the parties have been incorporated. Where the intention of the parties is clear no rules of construction are necessary . the paramount task of the law is to ascertain of a documents . the paramount task of the law is to ascertain the intention of the parties which must prevail. The rules are designed as necessary aids to the task . the rules of construction .the ordinary rules of grammar and punctuation will apply. Errors rules of grammar and punctuation will apply .
THE EDUSDEM GENERIS RULE
Ejusdem generis means of the same kind where general words follow specific words which have a quality in common the general words are not given their full interpretation but are considered to refer merely to things of the same kind as the specific words. Thus In a reference to jeweler , plate. Silver, gold or any articles the last three valuable kind as jeweler plate silver and gold and not as meaning any articles of any kind.
It has already been observed that there is an implied condition I every contract of insurance must maintain good faith . this further implode that the insured will not make a fraudulent claim . although for the sake of emphasis an express condition is incorporated in the policy. The onus of proving that the insured has insured to deal honestly with the insurers in making a claim . but the insured will not be penalized . there is no fraud where the insured places in opinion an honest valuation on the property damaged or destroyed even though this values exceeds the actual value since the insured is guilty of nothing more than a mistake. Where the jury found that the statement was made through ignorance.