and not prepared for particular cases, it follows that special agreements must frequently be endorsed on the policy with a view to modifying the original terms of the policy form. Whenever there is a difference in meaning between such endorsements and the policy form itself, it is a generally recognized principle that the superimposed parts of the contract, whether written or stamped or printed, control the regular provisions of the policy. This principle is based on the theory that anything endorsed on the policy must be later in date than the policy itself, and is thus presumed to represent the latest agreement between the parties. If any ambiguity exists in the wording of any such endorsement, the insured must again be given the benefit of the doubt.

Each policy is an independent contract.-Every insurance policy must be regarded as an independent contract, the interpretation of which depends upon its own terms and is not affected by the terms of any policy which preceded it, unless the insured and insurer have expressly agreed that the contrary shall be the case. This is an important principle in its application to the renewal of policies, and will be discussed at greater length under that subject.

Forfeiture generally limited to the continuance of policy violation. By the weight of authority, a violation of the conditions of the policy will cause a forfeiture only during the time that the violation continues. If, after a violation, the conditions of the policy are again complied with, the policy revives, even though the company never consented to the violation. Unfortunately the courts of the various states have rendered conflicting opinions on the important question of the effect which a violation of its terms has upon the life of a policy. Thus in New York and Pennsylvania, if a policyholder vacates his building contrary to the policy and without the consent of the com

pany, the act works a forfeiture during the period of vacancy, but if afterwards the building is again occupied and a loss occurs the company will be held liable, because the policy is considered to be revived when the violation is discontinued. In other states, however, such a violation nullifies the policy, and the policy once void will remain so, unless the insurer consents to its restoration.

Development of the Standard Policy.-Having stated the general principles which govern the interpretation of fire insurance contracts, let us now trace the evolution of the so-called standard policy. At first fire insurance was written almost entirely by individual underwriters whose operations were few in number, and generally confined to risks with which they were personally acquainted. The policy was brief in its terms, and included merely the description of the property, the amount of insurance, the term, and the premium. Soon, however, individual underwriting proved inadequate for the needs of the business community. A prime requisite in insurance is the financial strength of the insurer; and, as business developed in size, larger and larger sums of capital were necessary to furnish proper security to the public. Hence it came about that corporations everywhere began to supplant individuals as underwriters.

At first these corporations solicited insurance directly from their home offices. But with the growth of competition between the many companies that were springing up in all the leading Eastern cities, greater and greater reliance had to be placed upon the agency system. Representatives of the companies had to be stationed in the various towns so as to be easily and promptly accessible to property owners. The result was that with the spread of its underwriting activities over a larger area, the company was exposed on the one hand to possible dishonesty or incompetency on the part of the local agent, and, on

the other, to an increased moral hazard on the part of the insured. With the creation of agencies in all business communities it was only natural that the company should seek to protect itself and the public against the willful destruction of property by those who could not now be watched carefully. Many promissory and restrictive provisions had to be incorporated in the policy which would tend to protect the insurer against unnecessary risk and the payment of unjust claims. It was essential that the policy should now contain a full description of the property, and, on penalty of forfeiture, prevent concealment of facts prior to the issuance of the policy, and wrongful conduct in the maintenance and care of the property after the owner had secured the policy.

The incorporation of such restrictive provisions tended at this time not only to make the fire insurance policy a very voluminous contract, but all semblance of uniformity in the wording of different policies seemed to disappear. Each company had a policy of its own. In fact, the policy was local in character, one form prevailing in Boston, another in Philadelphia, and still another in New York. No coöperation of importance existed between the several companies, and the problem was made worse on the one hand, by the desire of some companies to enhance their business by the issuance of attractive special policies, and on the other, by the desire of a certain number of companies to defraud the insured of his rightful claim by the strict application of a skillfully drawn contract. The multifarious character of policy forms at this time is well described in a court decision in the following words:3

8

Delancy vs. Rockingham Farmers Mutual Fire Insurance Co., 52 N. H., 581. This decision is also very extensively quoted on pages 182-83 of the "Annals of the American Academy, September, 1905.

"Forms of applications and policies (like those used in this case), of a most complicated and elaborate structure, were prepared and filled with covenants, exceptions, stipulations, provisos, rules, regulations, and conditions, rendering the policy void in a great number of contingencies. These provisions were of such bulk and character that they would not be understood by men in general, even if subjected to a careful and laborious study; by men in general they were sure not to be studied at all. The study of them was rendered particularly unattractive by a profuse intermixture of discourses on subjects in which a premium payer would have no interest. The compound, if read by him, would, unless he were an extraordinary man, be an inexplicable riddle, a mere flood of darkness and confusion. Some of the most material stipulations were concealed in a mass of rubbish on the back side of the policy and the following page, where few would expect to find anything more than a dull appendix and where scarcely anyone would think of looking for information so important as that the company claimed a special exemption from the operation of the general law of the land relating to the only business in which the company professed to be engaged. As if it were feared that notwithstanding these discouraging circumstances, some extremely eccentric person might attempt to examine and understand the meaning. of the involved and intricate net in which he was to be entangled, it was printed in such small type and in lines so long and so crowded, that the perusal of it was made physically difficult, painful, and injurious.'

This utter lack of uniformity in fire policies proved te be exceedingly unfortunate for both insured and insurer. The policyholder, scarcely once in a hundred times, carefully studies the policy he procures. When every company issued its own special policy, many of them models of ambiguity, it frequently happened that the insured, when a loss occurred, found himself deprived of the indemnity on which he had confidently relied. The companies, on the

other hand, had to contend with a multiplicity of court decisions in the various states, many of which were in direct opposition to others, although dealing with the same subject. Everywhere the courts were called upon to pass on the interpretation of loosely drawn policies, and in their efforts to give the benefit of the doubt to the insured, and prevent a forfeiture on a poorly or skillfully drawn contract, as the case might be, they helped to develop a system of court law in insurance, which for its conflicting opinions has probably no parallel in any other line of business. The effect of these decisions is marked even at the present day, although nearly everywhere approximately the same policy is in use. "It would be well," writes Mr. F. C. Moore, "in all cases of lawsuits to bear in mind that when decisions are glibly quoted to sustain interpretations of particular phrases, that the policy in question before the court may have been very differently worded from the standard form now in use.' 4 Again, when large fires occurred, and several policies had been written on the property, it was common to find that they were unlike in their terms and application, thus making a settlement of the loss among the several companies impossible, except by an unsatisfactory compromise.

With such inconveniences resulting from a lack of uniformity in the terms, it was only natural that a sentiment should develop for the establishment of a "standard" policy, which when universally used by all companies would in the course of time he interpreted definitely by the courts, thus enabling the policyholder to be sure of its meaning. The first important attempt to adopt such a standard policy was undertaken by the National Board of Underwriters in 1867 and 1868. Then followed the law of 1873 in the State of Massachusetss, providing for a standard form of policy, which in 1880 was made Fire Insurance and How to Build," p. 556.