Opinion ID: 1748325
Heading Depth: 1
Heading Rank: 4

Heading: statutory definition considered

Text: The parties have a right to make a contract of insurance binding upon them, and however stringent they may be, if not opposed to some public policy or statute, they will be enforced as written, although such contracts are construed strictly against the insurer. New Amsterdam Cas. Co. v. Perryman, 162 Miss. 864, 871, 140 So. 342 (1932). In the instant case, the Legislature defined the word insured, and the majority seizes upon such definition as conclusive of the intent of the two parties to the disputed insurance contract. Sec. 83-11-103(b), Miss. Code Ann. (1972). We point out that the term insured is defined As used in this article. Sec. 83-11-103. From the language chosen by the Legislature, we conclude its intention was to define the word insured only as it is used in the statute, and not as it is used by two private parties entering into a contract. Gunn argues that the insurance policy should be construed according to the language chosen by the drafter, the insurer; and that when an ambiguity arises, such ambiguity should be strictly construed against the drafting party. This tracks the law of our state. Parties to a contract have the right to assume or not assume certain risks, and we must enforce contracts as they are written, unless they are contrary to the law of the state or to some public policy. Lavender v. Volunteer State Life Ins. Co., 171 Miss. 169, 182, 157 So. 101 (1934). Insurance contracts are construed strictly against the company which writes the policy and in favor of the insured. Cruse v. Aetna Life Ins. Co., 369 So.2d 762, 764 (Miss. 1979). (I)t is a well-established rule of construction that whenever there is an ambiguity in a policy of insurance, it is construed strictly against the insurance company which drafted the contract. Mississippi Ben. Ass'n v. Majure, 201 Miss. 183, 29 So.2d 110 (1947); Great American Ins. Co. v. Bass, 208 Miss. 436, 44 So.2d 532 (1950). Evana Plantation, Inc. v. Yorkshire Ins. Co., Ltd., 214 Miss. 321, 325, 58 So.2d 797 (1952). See also Government Employees Ins. Co. v. Brown, 446 So.2d 1002 (Miss. 1984); Brander v. Nabors, 443 F. Supp. 764, aff'd, 579 F.2d 888 (N.D.Miss. 1978); Pritchard v. Insurance Co. of North America, 61 F.R.D. 104 (N.D.Miss. 1973); Farr v. Sun Life Assur. Co. of Canada, 351 F. Supp. 299, aff'd 469 F.2d 1392 (N.D.Miss. 1972); America Southwest Corp. v. Underwriters at Lloyd's, London, 333 F. Supp. 1333 (S.D.Miss. 1971); English v. Insurance Co. of North America, 270 F. Supp. 713, aff'd 395 F.2d 854 (N.D.Miss. 1967); Employers Ins. of Wausau v. Trotter Towing Corp., 834 F.2d 1206, rehearing denied, 841 F.2d 633 (5th Cir.1988); Patton v. Aetna Ins. Co., 595 F. Supp. 533 (N.D.Miss. 1984); Reece v. State Farm Fire & Cas. Co., 684 F. Supp. 140 (N.D.Miss. 1987). In summary, we have determined that Gunn's insurance policy should be interpreted according to its own terms, as far as is possible, and any ambiguities should be strictly construed against the drafter. The policy thus provided Gunn with coverage for the accident which claimed the lives of his parents and his sister. The lower court did not reach the secondary issue, that of the amount of uninsured motorist coverage Gunn actually had at the time of the deaths, and so this question is not before us today. Cossitt v. Federated Guarantee Mutual Insurance Co., 541 So.2d 436 (Miss. 1989); Educational Placement Services v. Wilson, 487 So.2d 1316 (Miss. 1986). However, we would remind the participants that if a mistake is found in the language included in a policy of insurance, and if that policy was drafted by the insurer, the insurance company would not be entitled to reformation under most circumstances. The general rule in this state and elsewhere is that reformation of a contract is justified only (1) if the mistake is a mutual one, or (2) where there is a mistake on the part of one party and fraud on the part of another. Johnson v. Consolidated American Life Ins. Co., 244 So.2d 400, 402 (Miss. 1971).