2 Summary of California Law (10th), Insurance

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<d1.o n="I. ">INTRODUCTION

<d2.o n="A. ">Generally.

<d3.o n="1. " sec="1] ">In General.

<d3.o n="2. " sec="2] ">Commentary and Practice Works.

<d3.o n="3. " sec="3] ">Classes of Insurance.

<d3.o n="4. " sec="4] ">Insurer''&apos;s Rights of Subrogation, Contribution, and Indemnity.

<d2.o n="B. ">Regulation of Insurance.

<d3.o n="1. " sec="5] ">Power To Regulate.

<d3.o n="2. " sec="6] ">Governing Law.

<d3.o n="3. " sec="7] ">Department of Insurance and Insurance Commissioner.

<d3.o n="4. " sec="8] ">Policies Governed by Insurance Code.

<d3.o n="5. ">Rate Control.

<d4.o n="(a) " sec="9] ">Proposition 103.

<d4.o n="(b) " sec="10] ">Ratemaking Process.

<d3.o n="6. ">Insolvent Insurers.

<d4.o n="(a) " sec="11] ">Conservatorship and Liquidation.

<d4.o n="(b) ">Insurance Guarantee Associations.

<d5.o n="(1) " sec="12] ">In General.

<d5.o n="(2) " sec="13] ">Liability for Subrogation Claims.

<d3.o n="7. ">Automobile Liability Insurance.

<d4.o n="(a) " sec="14] ">Financial Responsibility Law.

<d4.o n="(b) " sec="15] ">Assigned Risk Law.

<d4.o n="(c) " sec="16] ">Low-Cost Insurance.

<d2.o n="C. ">Insurance Agents and Brokers.

<d3.o n="1. " sec="17] ">In General.

<d3.o n="2. " sec="18] ">Licensing and Regulation.

<d3.o n="3. " sec="19] ">Compensation and Other Rights.

<d3.o n="4. " sec="20] ">Duties and Liabilities.

<d2.o n="D. ">Liability for Failure To Insure.

<d3.o n="1. " sec="21] ">In General.

<d3.o n="2. " sec="22] ">Failure of Insurer To Act on Application.

<d3.o n="3. " sec="23] ">Third Party Engaging To Procure Insurance.

<d3.o n="4. " sec="24] ">Transferor of Insured Property.

<d2.o n="E. ">Conflict of Laws.

<d3.o n="1. " sec="25] ">In General.

<d3.o n="2. " sec="26] ">Life Insurance.

<d3.o n="3. " sec="27] ">Fire, Surety, and Casualty Insurance.

<d1.o n="II. ">FORMATION AND EFFECT OF INSURANCE CONTRACT

<d2.o n="A. ">Formation and Validity.

<d3.o n="1. ">General Principles.

<d4.o n="(a) " sec="28] ">Requisites and Elements.

<d4.o n="(b) " sec="29] ">Written Contracts: Policies.

<d4.o n="(c) " sec="30] ">Oral Contracts.

<d4.o n="(d) " sec="31] ">Parties to Contract.

<d4.o n="(e) " sec="32] ">Statutory Requirements for Legibility.

<d4.o n="(f) " sec="33] ">Foreign Language Policies.

<d3.o n="2. " sec="34] ">Application by Insured.

<d3.o n="3. ">Acceptance or Rejection by Insurer.

<d4.o n="(a) " sec="35] ">In General.

<d4.o n="(b) " sec="36] ">Insurer''&apos;s Right of Refusal.

<d3.o n="4. ">Interim Contracts: Binders.

<d4.o n="(a) " sec="37] ">In General.

<d4.o n="(b) " sec="38] ">Statutory Regulation.

<d4.o n="(c) " sec="39] ">Life Insurance Applications.

<d4.o n="(d) " sec="40] ">Return of Premium as Precondition to Rejection of Application.

<d4.o n="(e) " sec="41] ">Effect of Ambiguous Terms.

<d4.o n="(f) " sec="42] ">Where Insurer Is Not Designated.

<d4.o n="(g) " sec="43] ">Estoppel To Deny Coverage.

<d3.o n="5. " sec="44] ">Execution of Policy.

<d3.o n="6. ">Delivery of Policy.

<d4.o n="(a) " sec="45] ">In General.

<d4.o n="(b) " sec="46] ">Constructive Delivery.

<d3.o n="7. " sec="47] ">Validity.

<d2.o n="B. ">Construction.

<d3.o n="1. ">Generally.

<d4.o n="(a) " sec="48] ">Governing Rules and Principles.

<d4.o n="(b) ">Constituent Parts of Contract.

<d5.o n="(1) " sec="49] ">In General.

<d5.o n="(2) " sec="50] ">Particular Types of Policies.

<d4.o n="(c) " sec="51] ">Policy as Adhesion Contract.

<d4.o n="(d) " sec="52] ">Construction of Policy in Entirety.

<d4.o n="(e) " sec="53] ">Reference to Drafting History, Interpretive Materials, and Advertising.

<d4.o n="(f) " sec="54] ">Effect of Judicial Enlargement of Liability Covered.

<d3.o n="2. ">Unambiguous Provisions: Reference to Plain Meaning.

<d4.o n="(a) " sec="55] ">In General.

<d4.o n="(b) " sec="56] ">Lay Interpretation Governs.

<d4.o n="(c) " sec="57] ">Construction in Context.

<d4.o n="(d) " sec="58] ">Effect of Public Policy.

<d4.o n="(e) " sec="59] ">Illustrations.

<d3.o n="3. ">Ambiguous Provisions: Reasonable Expectations of Insured.

<d4.o n="(a) " sec="60] ">In General.

<d4.o n="(b) " sec="61] ">Relevant Factors.

<d3.o n="4. ">Ambiguous Provisions: Construction Against Insurer.

<d4.o n="(a) " sec="62] ">General Rule Favoring Insured.

<d4.o n="(b) " sec="63] ">Limitations on Rule.

<d4.o n="(c) ">Exclusionary Clauses: Terms Must Be Conspicuous, Plain, and Clear.

<d5.o n="(1) " sec="64] ">In General.

<d5.o n="(2) " sec="65] ">Illustrations of Conspicuous, Plain, and Clear Clauses.

<d2.o n="C. ">Performance and Breach.

<d3.o n="1. ">Conditions Precedent.

<d4.o n="(a) " sec="66] ">In General.

<d4.o n="(b) " sec="67] ">Payment of Premiums.

<d3.o n="2. " sec="68] ">Conditions Subsequent.

<d3.o n="3. ">Right to Proceeds.

<d4.o n="(a) " sec="69] ">In General.

<d4.o n="(b) " sec="70] ">Third-Party Beneficiaries.

<d4.o n="(c) " sec="71] ">Recovery by Insurer of Proceeds Paid Under Mistake.

<d4.o n="(d) " sec="72] ">Change of Beneficiaries or Beneficial Rights.

<d3.o n="4. " sec="73] ">Breach of Contract.

<d2.o n="D. " sec="74] ">Transfer.

<d1.o n="III. ">INSURABLE INTEREST

<d2.o n="A. " sec="75] ">In General.

<d2.o n="B. " sec="76] ">Property Insurance.

<d2.o n="C. " sec="77] ">Automobile Insurance.

<d2.o n="D. ">Life and Disability Insurance.

<d3.o n="1. " sec="78] ">In General.

<d3.o n="2. " sec="79] ">Insurable Interest of Employers, Benefit Plan Trustees, and Charities.

<d3.o n="3. " sec="80] ">Insurable Interest of Creditors.

<d1.o n="IV. ">COVERAGE OF POLICIES GENERALLY

<d2.o n="A. ">Basic Principles.

<d3.o n="1. " sec="81] ">In General.

<d3.o n="2. " sec="82] ">Burden of Proof.

<d3.o n="3. ">Types of Coverage.

<d4.o n="(a) " sec="83] ">First-Party and Third-Party Coverage.

<d4.o n="(b) ">Primary and Secondary Coverage.

<d5.o n="(1) " sec="84] ">In General.

<d5.o n="(2) " sec="85] ">"Other Insurance" Clauses.

<d4.o n="(c) " sec="86] ">Individual and Group Coverage.

<d4.o n="(d) " sec="87] ">Partnership Insurance.

<d4.o n="(e) " sec="88] ">Reinsurance.

<d3.o n="4. ">Definition and Scope of Terms.

<d4.o n="(a) " sec="89] ">In General.

<d4.o n="(b) " sec="90] ">"&ldquo;Accident."&rdquo;

<d4.o n="(c) " sec="91] ">"&ldquo;Advertising Injury."&rdquo;

<d4.o n="(d) " sec="92] ">"&ldquo;Bodily Injury."&rdquo;

<d4.o n="(e) " sec="93] ">"&ldquo;Damages."&rdquo;

<d4.o n="(f) " sec="94] ">"&ldquo;Family,"&rdquo; "&ldquo;Household,"&rdquo; or "&ldquo;Residence."&rdquo;

<d4.o n="(g) " sec="95] ">"&ldquo;Intentional Act."&rdquo;

<d4.o n="(h) " sec="96] ">"&ldquo;Legally Obligated To Pay."&rdquo;

<d4.o n="(i) " sec="97] ">"&ldquo;Pollution."&rdquo;

<d4.o n="(j) " sec="98] ">"&ldquo;Property Damage."&rdquo;

<d4.o n="(k) " sec="99] ">"&ldquo;Suit."&rdquo;

<d2.o n="B. ">Prohibited Indemnifications.

<d3.o n="1. ">Wilful Acts of Insured.

<d4.o n="(a) " sec="100] ">In General.

<d4.o n="(b) ">What Constitutes Wilful Act.

<d5.o n="(1) " sec="101] ">Conduct Intended To Harm or Inherently Harmful.

<d5.o n="(2) " sec="102] ">Effect of Insanity.

<d4.o n="(c) ">Particular Acts.

<d5.o n="(1) " sec="103] ">Wrongful Termination.

<d5.o n="(2) " sec="104] ">Malicious Prosecution.

<d5.o n="(3) " sec="105] ">Child Molestation.

<d5.o n="(4) " sec="106] ">Sex Torts Involving Battery or Fraud.

<d5.o n="(5) " sec="107] ">Sexual Harassment.

<d5.o n="(6) " sec="108] ">Other Examples.

<d4.o n="(d) ">Distinctions.

<d5.o n="(1) " sec="109] ">Negligent Act.

<d5.o n="(2) " sec="110] ">Act Not Committed by Insured.

<d5.o n="(3) " sec="111] ">Liability Under Surety Bond.

<d5.o n="(4) " sec="112] ">Independent Coverage.

<d3.o n="2. " sec="113] ">Punitive Damages.

<d2.o n="C. ">First-Party Insurance.

<d3.o n="1. " sec="114] ">In General.

<d3.o n="2. " sec="115] ">Trigger of Coverage.

<d3.o n="3. ">Causation of Loss.

<d4.o n="(a) " sec="116] ">In General: Efficient Proximate Cause Standard.

<d4.o n="(b) " sec="117] ">Distinction: Separate Characterization of Excluded Cause.

<d3.o n="4. ">Life Insurance.

<d4.o n="(a) " sec="118] ">In General.

<d4.o n="(b) " sec="119] ">Accidental Death Provisions.

<d4.o n="(c) " sec="120] ">Condition of Insured''&apos;s Good Health.

<d4.o n="(d) " sec="121] ">Exclusion for Suicide.

<d3.o n="5. ">Health and Disability Insurance.

<d4.o n="(a) " sec="122] ">In General.

<d4.o n="(b) " sec="123] ">Total Disability.

<d4.o n="(c) " sec="124] ">Inception of Covered Condition.

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