Page:The Insurance Law Journal, Volume 4, 1875.pdf/11

cance where every other word used in the proviso designates the means by which a fire may happen for which the company will not be liable, and expresses clearly what is unlawful and employed to disregard or subvert the laws of the government.

Boon vs. ælna Ins. Co.

§ 3. Life.—Failure to pay Interest on Premium Notes does not forfeit a Life Policy—A ten year life policy was issued containing these conditions: That if the insured: failed to make any of the subsequent payments, such default should not work a forfeiture of the policy, but that the sum insured should be commuted or reduced to a paid-up policy of such proportional part of the whole amount as the number of premiums bore to the number required, and also, if the interest on the premium notes was not paid annually in advance, this default should work a forfeiture of the paid-up policy. Three annual payments were made, and a paid-up policy for $3,000 was issued. Insured failed to pay the interest, amounting to $49.04, on these notes, and died a few months after. It was shown on trial that there was a cash dividend due the insured of $42.07, thus reducing the debt of the insured to $6.97. Defendant refused to pay the policy of $3,000, alleging that it had lapsed by the non-payment of the interest due. Held, that the exact conditions of the policy in respect to forfeiture by the non-payment of premiums, have uniformly been enforced by the courts. Such forfeiture is not considered as being in the nature of a penalty, but that in agreements of this kind time is of the essence of the contract. The privilege of keeping the policy in force, or of abandoning it, lies with the insurer, and the failure to pay the notes when required by the company will work a forfeiture of the policy. Held, that the annual interest due on these premium notes or loans was not an annual premium, for the non-payment of which the paid-up policy could be forfeited, but that the company was bound to look to the insured for the payment of the interest as though he was a stranger to the contract of insurance. The ultimate pay-