property and took out a policy on it. He sold the property to B and assigned the policy to B, with the consent of the company. B then mortgaged back the property to A, and directed payment to be made to A as his interest should appear. B later violated the policy. Subsequently a fire took place. It was held that there could be no recovery on the policy; none by A in his own right, because it was no longer his policy, since it was based now on B's insurable interest; nor could there be a recovery by A, as the assignee of B, because B had by his violation forfeited the policy (32). This case shows that, under such circumstances, an insurance policy taken out by the mortgagor and made payable to the mortgagee is no great protection to the latter, since it may be forfeited by any act on the part of the mortgagor. To provide for this difficulty, the standard insurance policy contains a clause which provides in effect that, when a policy is made payable to the mortgagee, it shall not, so far as his interest is concerned, be forfeited by any act committed by the mortgagor (33). § 17. Same: Consent of insurer to assignment. The consent of the company is necessary only to a complete assignment. The appointment by A of B as his agent to collect (34), or a pledge of the policy, or an agreement to assign (35), is not within the clause that requires the consent of the company. This clause also has no application (32) (33) (34) Smith v. Insurance Co., 120 Mass. 90. Minturn v. Insurance Co., 10 Gray (Mass.) 501. (35) Insurance Co. v. Morrison, 11 Leigh (Va.) 367. to an assignment of a claim against the company after loss. § 18. Fire insurance: Beneficiaries. The principles that have been stated above with reference to the rights of B, as assignee of a policy, also apply where the policy is on its face made payable to B as beneficiary. He has a vested right to the proceeds, but it is still A's policy, and if A does anything to forfeit the policy, B cannot recover (36). § 19. Life insurance: Assignees. With certain modifications, the principles already discussed as to the rights of assignees and beneficiaries in fire insurance, also apply to life insurance. The insured may assign his policy and the assignee acquire a vested interest, but one which is liable to be divested if the insured forfeits the policy. In some jurisdictions (37) there is a further requirement that the assignee of a life policy must also have an insurable interest, but in most jurisdictions it is held that, if the policy is taken out by the insured in good faith, he can assign it to whom he will, it being obvious that he may be relied on for his own sake not to assign it to an improper person. In the jurisdictions above mentioned, where the assignee is required to have an insurable interest; if the policy is assigned in good faith and the assignee have no insurable interest, the policy is not void. The assignee can recover back the premiums paid by him, and the balance of the policy goes to the estate of the deceased (38). (36) Grosvenor v. Insurance Co., 17 N. Y. 391. (37) Indiana, Kansas, Kentucky, Missouri, Pennsylvania, Texas. (38) Insurance Co. v. Armstrong, 117 U. S. 591. In any case, if an insurance policy is taken out by A on his own life and at once assigned to B, who has no insurable interest, so that it is clear that the whole transaction is simply a scheme to let B do indirectly what he could not do directly, the policy is bad (39). § 20. Life insurance: Beneficiaries. The same difference of opinion that prevails as to whether or not the assignee of an insurance policy need have an insurable interest, also prevails on the question whether or not the beneficiary need have an insurable interest. The better rule is that he need not have. Like the assignee, he has a vested interest of which he cannot be deprived without his consent. So where a husband took out a policy on his own life payable to his wife, and later surrendered the policy, forging a release in his wife's name, it was held that she could still hold the company on the policy (40). But it is to be noted that the policy is still subject to all of the conditions, among which is the obligation to pay the premiums as they fall due. Hence, in a case similar to the above, where the insured's wife failed to keep up the premiums because of the fraud of her husband, the policy was nevertheless held to be forfeited (41). The beneficiary in a certificate issued by a mutual benefit association has no vested right, and it may be changed at the will of the person insured (42). The same rule of course obtains with the ordinary policy, where the power to change the beneficiary is expressly reserved in the policy. (39) Warnock v. Davis, 104 U. S. 775. (40) Whitehead v. Insurance Co., 102 N. Y. 143. (41) Schneider v. Insurance Co., 123 N. Y. 109. (42) Martin v. Stubbing, 126 Ill. 387. § 21. Same: Controverted case. Controverted case. The following kind of a case has been the subject of much discussion and difference of opinion in the courts. Suppose the husband takes out a policy on his own life payable to his wife, and the wife dies before the husband, leaving all her property and rights to her child, C, and then the husband dies. Who gets the proceeds of the policy; the executor of the husband; or C, who claims under the wife? If the policy on its face is made payable to the wife, her executors, administrators, and assigns, the cases generally agree that C would win (43). This would clearly be the case if it was made payable to the wife, and on her death to C. But if it is made payable simply to the wife, there is more doubt. It is generally settled that, if it is an endowment policy, the interest of the beneficiary is purely personal and ends on her death. If it is a straight life policy, most courts hold that the interest of the beneficiary may be transferred by her on her death as she desires, and consequently, in the case first put, in most jurisdictions C, who claimed under the wife's will, would prevail as against the executors of her husband (44), although there are many decisions to the contrary. (43) Millard v. Brayton, 177 Mass. 533. 4) Harley v. Heist, 86 Ind. 196. CHAPTER II. REPRESENTATIONS, CONCEALMENT, AND WARRANTIES. SECTION 1. REPRESENTATION AND CONCEALMENT. § 22. Marine insurance. Because of the peculiar character of the contract of insurance, the most striking feature of it being the payment of a comparatively small premium, in return for which a disproportionately large sum may be obtained upon the happening of the contingency insured against; and because the facts with regard to the subject matter of the insurance were peculiarly within the knowledge of the applicant; the rule was at the earliest period enforced by the courts in marine insurance, that the contract was one of the utmost good faith, "uberrimae fidei," on both sides. They consequently held that it was the duty of the applicant for insurance to disclose fully to the underwriter all facts that might reasonably be likely to influence him in determining whether or not he would issue the policy. A concealment or misrepresentation of a material fact gave the insurer a defense to an action on the policy, and the good faith of the insured made no difference, if in fact his statement was not substantially true and all material facts were not disclosed. A material fact was at an early date defined by the court as any fact which, if known to the insurer, might |