ON THE NATURE OF INSURANCE* 245 



answer to a claim of 500/., replied, that the intention 

 of B in insuring the life of C, was to obtain security 

 for the payment of a debt of 5001., due by C to B, 

 which debt had been already paid by C's executors: 

 consequently they owed nothing to B. An action was 

 brought by B, and defended by A and Co. on the above 

 plea ; and a special case being made, the point was de- 

 cided by the court of King's Bench against the plain- 

 tiffs ; thereby establishing the principle, that life in- 

 surance is a thing similar to fire or ship insurance ; 

 namely, a contract of indemnity, to be fulfilled with 

 allowance for salvage. 



The defendants' case rested upon the asserted nature of 

 the contract, and the statute 14Geo. III. c. 48., which 

 enacts, that " no greater sum shall be recovered from 

 the insurers than the amount or value of the interest 

 of the insured in such life." The act does not state 

 at what time this interest is to be reckoned, but the 

 plaintiffs contended that the time of death was the 

 meaning of the statute ; the defendants averred, and 

 the court decided, that the time of bringing the action 

 was to be understood. The plaintiffs contended that 

 the debt was not the object of insurance, but the life 

 of the insured ; the court decided, that fc This action is, 

 in point of law, founded upon a supposed damnification 

 of the plaintiffs, occasioned by the death, existing and 

 continuing to exist at the time of the action brought ; 

 and, being so founded, it follows, of course, that if, 

 before the action was brought, the damage which was 

 at first supposed likely to result to the creditor were 

 wholly obviated and prevented by the payment of his 

 debt, the foundation of any action on his part, on the 

 ground of such insurance, fails." This sentence con- 

 tains nothing but very good sense, and, no doubt, very 

 good law : but the application of it was accompanied 

 by a mistake as to the nature of the damnification 

 which the plaintiffs had sustained. The counsel on 

 both sides, the court, the insurance office, and the 

 plaintiffs themselves, showed a very partial knowledge 

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