U.S. Ins. Co. of Waco v. Boyer

• Decision Date: 23 June 1954
• Docket Number: No. A-4538,A-4538
• Citation: 269 S.W.2d 340,153 Tex. 415
• Parties: UNITED STATES INS. CO. OF WACO v. BOYER.
• Court: Texas Supreme Court

Page 340

269 S.W.2d 340

153 Tex. 415

UNITED STATES INS. CO. OF WACO v. BOYER.

No. A-4538.

Supreme Court of Texas.

June 23, 1954.

Rehearing Denied July 21, 1954.

Phenix, Reeves & Oubre, Waco, for petitioner.

Maddin & Copeland, Waco, for respondent.

WILSON, Justice.

This is a suit upon the collision clause of a standard automobile insurance policy issued August 17, 1953. While the insured car was parked on a downtown street in Waco, a windstorm demolished a building and left the car crushed under brick and timbers.

In affirming the judgment against the insurance company, 264 S.W.2d 151, 152, the Court of Civil Appeals stated the principal question to be:

'* * * Whether a stationary vehicle damaged by falling debris from a building damaged by a tornado, is' within 'an insurance policy insuring against damage or loss to an automobile in collision with another object.'

It based its decision upon Providence Washington Insurance Co. v. Proffitt, 150 Tex. 207, 239 S.W.2d 379, and reached the conclusion that the impact between the timbers, brick, etc., and the car was a collision within Coverage E-1. ¹ Petitioner contends this holding conflicts with O'Leary v. St. Paul Fire & Marine Ins. Co., Tex.Civ.App., 196 S.W. 575, and American Automobile Insurance Co. v. Baker, Tex.Civ.App., 5 S.W.2d 252.

In construing contracts, the timehonored method of the courts has been to search for the intent of the parties and this is true in cases construing insurance contracts just as in other contracts. While undoubtedly in the early days of the insurance business the actual intent of the immediate parties to the contract was material, now with the insurance business regulated and the policy forms prescribed by a State Insurance Commission, the court in construing a policy determines the everyday meaning of the words to the general public-the meaning of the words 'in common parlance'-'the usual and popular understanding of the term.' American Automobile Ins. Co. v. Baker, supra. As a practical matter, the actual intent involved in the precise words is as much or more the intent of the Insurance Commission which prescribes the wording of the policy as it is the intent of the parties. It is unlawful to issue a policy in words other than those expressly approved by the Insurance Commission, and every insurance company selling this type of insurance is required to word its policies precisely alike. Art. 5.06 Insurance Code, V.A.C.S. Uniform policies are necessary to a uniform rate structure, which in turn resulted from the public injury caused by highly competitive wildcat insurance schemes. Therefore, a true search for what the courts usually speak of as the intent of parties will not be an inquiry as to what the words of the contract meant to this particular insurer or insured. It is, first, an effort to determine the ordinary lay meaning of the words to the general public, and, in the light of this meaning, it is, second, an examination of the choice the purchaser had and the choice he made. Glen Falls Ins. Co. v. McCown, 149 Tex. 587, 236 S.W.2d 108.

Under the policy form prescribed by the Insurance Commission, a windstorm is defined as a separate peril. It might be that the Insurance Commission could prescribe one all-inclusive risk policy on automobiles and give the public the choice of that or nothing. But the Insurance Commission has not done that. It has attempted to divide up the risks and allow the public the opportunity to purchase collision without purchasing hail or windstorm if that seems desirable. If the impact of hailstones on a car is a collision, why should anyone purchase collision and hail? Likewise, if the impact of objects blown through the air by the wind is a collision, why purchase collision and windstorm? Under the method of basing premiums upon the loss experience, the effect of the respondent's construction would be to drive up the premium rate on collision by including losses from wind and hail in the loss experience and make it impossible for the public to purchase collision without some wind and hail coverage. This construction tends toward one all-inclusive risk policy contrary to the policy of the Insurance Commission and therefore contrary to its intent.

Here the insured elected to purchase Coverage E-1 ¹ and elected not to purchase Coverage H ² (which would include windstorm), or Coverage I ³ (which would also include windstorm). We know this much about his specific intent. He intended to purchase collision and he intended not to purchase windstorm.

In Providence Washington Insurance Company v. Proffitt, supra (150 Tex. 207, ...