On March 5, 1902, the then superintendent of insurance in his annual report, at pake 7, made the following recommendation relative to amending the provisions of Section 289:

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"Section 289 declares it 'unlawful for any company, corporation or association to engage in the business of insurance, or to enter into any contracts substantially amounting to insurance, or in any manner to aid therein, in this state, without first having complied with all the provisions of this chapter.

"The chapter referred to is Chapter VIII, Title III, Division II, Part First of the Revised Statutes. This chapter contains general provisions, applying to some insurance companies.

"Chapters X and XI of Title II, Division II, Part Second, contains many important regulations, and authorize insurance not subject to this Chapter VIII. It is recommended that from Section No. 289 the following be eliminated, 'without first having complied with all the provisions of this Chapter' and that the following be substituted therefor, 'unless the same is expressly authorized by the statutes of this state, and such taututes and all laws regulating and applicable to such insurance or contracts have been complied with.""

On May 12, 1902, 95 O. L., 553, said Section 289 was amended by the legislature in the manner suggested by the superintendent of insurance as follows:

* "and it is unlawful for any company, corporation or association, whether organized in this state or elsewhere, either directly or indirectly, to engage in the business of insurance, or to enter into any contracts substantially amounting to insurance, or in any manner to aid therein, in this state, or to engage in the business of guaranteeing against liability, loss or damage unless the same is expressly authorized by the statutes of this state, and such statutes and all the laws reguhave been complied with; lating the same

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There is nothing to indicate that the legislature in adopting the report of the codifying commission intended to change the meaning of the language contained in Section 289 of the Revised Statutes; and if there is any ambiguity in the language of the revision, it is a well settled principle of law that reference will be had to the section of the Revised Statutes from which it was taken, in order to ascertain its proper interpretation. It seems clear, therefore, that it was the legislative intent in the adoption of Section 665, General Code, to prohibit the making of insurance contracts of any kind in Ohio unless that particular kind of insurance is expressly authorized by law. It follows that insurance cannot be written in Ohio

under any rule of comity, because no insurance can be made except such as is expressly authorized by law (by which is meant legislative enactment), and if expressly authorized there is no necessity or occasion to resort to the rule of comity.

Objection has been raised to the making of the form of insurance set forth in the policy form submitted in your letter on account of the agreement or covenant contained in Paragraph 2 thereof:

"2. To defend in the name and on behalf of the assured any suit brought against the assured to enforce a claim whether groundless or not.

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this objection being based upon the decision of the supreme court of Ohio in the case of State vs. Laylin, 73 O. S., 90, the syllabus of which is as follows:

"1. A foreign corportion, the sole business of which is authorized by its charter, is that of defending physicians and surgeons against civil prosecution for malpractice, which, in the prosecution and conduct of said business, issues and sells to members of the medical profession a contract whereby it undertakes and agrees to defend the holder of said contract against any suit for malpractice that may be brought against him during the term therein specified, but does not assume, or agree to assume or pay, any judgment that shall be rendered against him in such suit, is not engaged in the business of insurance, nor is the contract so issued and sold an insurance contract.

"2. But a foreign corporation created for the purpose of engaging in and carrying on such business, is not entitled to have or receive from the secretary of state of the state of Ohio, a certificate authorizing it to transact such business in this state, for the reason that the business proposed is professional business, and as such is expressly prohibited to corporations by Section 3225 of the Revised Statutes of Ohio."

It will be observed that the court found from the evidence in the above case that the sole authorized business of the physicians' defense company was that of defending physicians, that the company neither paid nor agreed to pay any indemnity whatever, and that the contract written by it was not a contract of insurance, but a contract for professional services and prohibited by the statutes.

The policy form submitted in your letter, however, is a contract of indemnity wherein the insurer agreed to indemnify the assured under certain conditions and limitations to a stipulated amount. As incidental to such contract of indemnity, the insurer agrees to defend "in the name and on behalf of the assured any suit brought

against the assured." In the insurance world it is a well recognized fact that these provisions to defend are inserted as much for the benefit and protection of the insurance company as for the benefit of the assured. By virtue of such provision the insurance company may protect itself from the payment of indemnity resulting from the failure of the assured to make proper defense in an action brought against him. This provision in the policy form submitted is clearly incidental to the main contract of indemnity, and in no manner impairs its essentials as an insurable contract. Since the policy form under consideration is a contract for indemnity and is therefore insurance, an agreement of the insurer to defend the assured is merely incidental and the principle laid down in the case of State vs. Laylin, supra, is not applicable.

Specifically answering the several questions asked by you, I am of the opinion:

1. That physicians' liability insurance of the class specified by you is authorized by the language of Paragraph 2 of Section 9510 of the General Code, and may be written in Ohio by any company organized or admitted to make the several kinds of insurance enumerated in said paragraph.

2. Section 665 of the General Code is a limitation upon the business of insurance, and no insurance can be made in Ohio unless that particular kind of insurance is expressly authorized by Ohio laws. The fact that a foreign insurance company, admitted to do business in Ohio, is by its charter and the laws of its home state authorized to make a particular kind of insurance will not authorize such company to make that kind of insurance in Ohio unless it is. expressly authorized by Ohio law.

3. Physicians' liability nsurance is not authorized by the provisions of Paragraph 2 of Section 9510 of the General Code, which confers the right "to make insurance on the health of individuals and against personal injury."

4. The provision contained in Paragraph 2 of the policy form quoted in your letter "to defend in the name and on behalf of the assured any suit brought against the assured" being merely incidental to the main contract of indemnity may be embodied in the policy without conflicting with the principle laid down in the case of State vs. Laylin, 73 O. S., 90.

A Foreign Insurance Company Authorized by its Charter and the Laws of the State of its Incorporation to Write Physicians' Liability Insurance, and Which is Admitted to do Business in Ohio Under Section 9385, General Code, May Make Physicians' Liability Insurance Contracts in This State, but Such Company is Required to Deposit $50,000.00 in Bonds as Prescribed by Section 9510, General Code, Paragraph 2.

No. 1050-(Opinion Dated November 29, 1915.) Honorable Frank Taggart, Superintendent of Insurance, Columbus, Ohio.

Dear Sir: I am in receipt of your letter of November 19, 1915, requesting my opinion as follows:

"The Aetna Insurance Company claims the right to write physicians' liability insurance under and by virtue of Section 9385. Its charter and the laws of the state of its origin permit it to do this class of business.

"I am requesting you to consider this question in conjunction with the right of companies to issue physicians' liability insurance, which has heretofore been submitted to you. I do this in order to save the necessity of submitting again to you the question of physicians' liability from a different angle, and in order that the entire question may be concluded by your opinion."

As my opinion holding that physicians' liability insurance is authorized by Paragraph 2 of Section 9510 of the General Code and may be written in Ohio by a company organized or admitted to make the several kinds of insurance therein enumerated is already prepared, I am addressing my reply to the question submittd in your letter just quoted as a separate opinion, which may be considered as supplementary to the general opinion on physicians' liability insurance.

From the facts stated in your letter and in the brief submitted by Honorable A. I. Vorys, representing the Aetna Life Insurance Company, it appears that this company is a foreign life insurance company organized under the laws of Connecticut, and that its charter and the laws of Connecticut permit it to make liability insur

ance.

The Aetna Life Insurance Company is licensed to do business in Ohio and secures its right to transact its business primarily under Section 9385 of the General Code, which is a part of the chapter relating to life insurance, whereas Section 9510 of the General

Code, under which I have heretofore held that physicians' liability insurance may be written in Ohio, is a part of the chapter relating to insurance upon property and against certain contingencies. The Aetna Life Insurance Company claims the right to make physicians' liability insurance under Section 8385 of the General Code, which is as follows:

"No company, organized under the laws of this state, shall undertake any business or risk, except as herein provided, and no company, partnership, or association, organized or incorporated by act of congress, or under the laws of this or any other states of the United States, or by any foreign government, transacting the business of life insurance in this state, shall be permitted or allowed to take any kind of risks, except those connected with, or appertaining to making insurance on life or against accidents to persons or sickness, temporary or permanent physical disability, and granting, purchasing and disposing of annuities; nor shall the business of life insurance, or life and accident insurance in this state, be in any wise conducted or transacted by any company, partnership or association which in this state, or any other state or country, make insurance on marine, fire, inland, or any other risk, or does a banking or any other kind of business in connection with insurance."

While the language of Section 9385 of the General Code, above quoted, is that of regulation and restriction rather than of affirmative grant, nevertheless by clear implication it recognizes the right and would seem to confer upon and invest in companies having charter authority such as the Aetna Life Insurance Company with full authority to make insurance and take risks in anywise connected with or appertaining to accidents to or sickness of persons.

By analogy from the principle announced and the reasoning expressed by the supreme court in the case of State ex rel. vs. The Aetna Life Insurance Company, 69 O. S., 317, I am of the opinion that physicians' liability insurance may be written in Ohio under Section 9385 of the General Code by the Aetna Life Insurance Company. In that case the court held that a foreign insurance company (which was the Aetna Life Insurance Company, of Hartford, Conn.), licensed to do business in Ohio, and whose charter conferred upon it authority to make employers' liability insurance, was privileged to write such insurance in Ohio under the language of Section 9385 of the General Code:

"to make insurance and take risks connected with and appertaining to accidents to persons."