App. Div.] First Department, January, 1921. for by agreement or condition written hereon or attached or appended hereto." And it was further provided in line 113, as follows: "This policy is made and accepted subject to the foregoing stipulations and conditions, together with such other provisions, agreements, or conditions as may be endorsed hereon or added hereto." It is to be borne in mind that during all the period from 1886 down to the time the form of the policy was changed by the amendment of 1917, the statute prohibited the indorsing on or adding to the standard form of policy of any provision, agreement or condition inconsistent with the provisions of the standard form of policy; and yet throughout that period said blank form of rider, specified thereon as such average clause but better known and generally referred to as a coinsurance clause, was in use. By section 2 of chapter 440 of the Laws of 1917 section 121 of the Insurance Law, as theretofore amended, was repealed, and by section 3 thereof a new section 121 was added to take effect January 1, 1918, so as to provide with respect to the standard policy and clauses that may be added thereto as follows: "The printed blank form of a contract or policy of fire insurance adopted by the National Convention of Insurance Commissioners at its meeting held in the city of New York on the twelfth day of December, nineteen hundred and sixteen, shall be filed by the Superintendent of Insurance in his office on the first day of January, nineteen hundred and eighteen, with the date of such filing indorsed thereon by him and shall be known and designated as the 'Standard fire insurance policy of the State of New York,' and no other or different provision, agreement, condition or clause shall be in any manner made a part of such contract or policy or indorsed thereon or added thereto or delivered therewith, except as follows, to wit: * * * * "Third. There may be printed in the space indicated by the words 'space for description of property,' or added to the policy at such space by agreement in writing thereon or by rider attached thereto the following: 2. The extent of the application of insurance under the policy; 3. * First Department, January, 1921. * * * [Vol. 195. The extent of the contribution to be made under the policy in case of loss or damage; 4. Any other matter necessary clearly to express all the facts and conditions of insurance on any particular risk. Provided, however, that no such agreement or rider shall be inconsistent with or a waiver of any of the conditions or provisions of the standard fire insurance policy hereby established, Forms of riders, indorsements, clauses, permits, forms or other memoranda to be attached to and made a part of fire insurance contracts relating to property located in this State may be presented for filing in the office of the Superintendent of Insurance by any corporation, association or bureau maintained for the purpose of suggesting, approving or making rates to be used by more than one underwriter for insurances on property located in this State, and, when approved and filed by such Superintendent of Insurance, shall thereupon become standard forms of riders, indorsements, clauses, permits, forms or other memoranda and their use shall be required, as hereinbefore provided." The policy described in the submission was the standard form referred to in the last amendment to the statute, and by it the numbered lines are transferred from the body to the back of the policy with some changes and are renumbered. By the policy, in so far as here material, the defendant insured the plaintiff to the extent of the actual cash value of the property therein described to an amount not exceeding $100,000 from all direct loss or damage by fire. In the paragraph next to the last in the body of the policy it was provided that it was made and accepted subject to the preceding stipulations and conditions, " and to the stipulations and conditions printed on the back hereof, which are hereby made a part of this policy, together with such other provisions, stipulations and conditions as may be endorsed hereon or added hereto as herein provided." The conditions printed on the back of the policy are printed in fine print and the lines thereof are numbered consecutively from 1 to 200. Lines 72 to 77, inclusive, are as follows: "ADDED CLAUSES. The extent of the application of insurance under this policy and of the contribution to be made by this Company in case of loss or damage, and any other agreement not inconsistent with or a waiver of any of the conditions or App. Div.] First Department, January, 1921. provisions of this policy, may be provided for by agreement in writing added hereto." Lines 101 to 105, inclusive, are as follows: “PRO RATA LIABILITY. This Company shall not be liable for a greater proportion of any loss or damage than the amount hereby insured shall bear to the whole insurance covering the property, whether valid or not and whether collectible or not." It will be observed that the provisions contained in lines 101 to 105, inclusive, and the first three lines of the paragraph relating to "added clauses" of the new standard policy, are substantially the same as those theretofore contained in a single sentence in the former policy in lines 96 to 100, inclusive. The remaining provisions of the "added clauses" contained in lines 74 to 77, inclusive, to wit, " and any other agreement not inconsistent with or a waiver of any of the conditions or provisions of this policy, may be provided for by agreement in writing added hereto," are the same, in substance, as the provisions of the former standard policy in line 113 herein quoted, with the additional provisions that any such further agreement to be added to the policy shall not be inconsistent with or a waiver of any of the conditions or provisions of the policy. Although the former standard policy contained no such provision on the subject of inconsistent agreements, it will be observed that at all times from the enactment of chapter 488 of the Laws of 1886 to the amendment of section 121 in 1917, the statute itself forbade the making of any special agreement inconsistent with the provisions of the standard policy. It is also to be noted that by the changes made in the standard policy in 1917, the provisions with respect to the pro rata liability of the insurer where there is more than one policy on the property, and the provisions relating to the extent of the application of insurance under the policy and the contribution to be made by the insurance company in case of loss or damage, which were embodied in the same sentence in the former standard policy, have been separated and the pro rata provisions are now preceded by the heading "Pro Rata Liability," and the others are preceded by the heading “Added Clauses," and they precede the provisions relating to pro rata liability. This change has a significant bearing on the point First Department, January, 1921. [Vol. 195. as to whether, as contended by the plaintiff, the provisions with respect to the extent of the application of the insurance and with respect to the contribution to be made by the insurer relate only to the application of the insurance and to contribution as between insurance companies and concerning their pro rata liability. If that were their only purpose, it would seem that they would have been left, as before, together. On this point, we are informed by counsel for the defendant that no form of clause or rider for a special agreement with respect to the pro rata liability, apportionment or contribution as between insurance companies has ever been filed; and it is, therefore, contended, with much force, I think, that the provisions with respect to the extent of the apportionment of the insurance and of the contribution to be made by the insurer were intended and understood to apply, if not exclusively at least also, to other agreements than those relating to pro rata liability as between insurance companies. That this is so is, I think, demonstrated by the history of so-called coinsurance and by the opinions of the courts with respect thereto prior to the enactment of any of the statutes to which reference has been made and during the time that the statutes prior to the amendment of section 121 in 1917 were in force. Coinsurance in ordinary fire insurance policies is an application, in part, of the general rule in use for centuries with respect to marine insurance, under which the insured was deemed a coinsurer with respect to the excess in value of the property insured over and above the amount of insurance thereon, or in other words, that part of the risk not covered by the insurance policies and he was entitled to share to that extent in any salvage. (Winter Marine Ins. 164, 165; 2 Arnould Marine Ins. § 1215; 2 Parsons Marine Ins. 405; 2 Philips Ins. § 1435.) Webster's International Dictionary defines "co-insurance" as follows: "Co-insurance ** *, that system of fire insurance in which the insurer is treated as insuring himself to the extent of that part of the risk not covered by his policy, so that any loss is apportioned between him and the insurance company on the principle of average, as in marine insurance or between other insurers," and "co-insurance clause. Fire insurance" as "the clause in a policy of insurance which provides for the application of the coinsurance system in case of loss." We find that the courts in App. Div.] 99 66 First Department, January, 1921. deciding cases involving coinsurance use the words "apportionment,' proportion" and "contribution," which are the words embodied in our statute and in the former and present standard form of policy, as applicable to that part of the insurance which, in such cases, the insurer himself is deemed to carry. (Buse v. National Ben Franklin Insurance Co., 96 Misc. Rep. 229; affd., without opinion, 177 App. Div. 948; 226 N. Y. 589; Farmers' Feed Co. v. Scottish Union Insurance Co., 173 id. 241; Chesbrough v. Home Ins. Co., 61 Mich. 333; 2 Arnould Marine Ins. § 1215.) It is manifest that the rates of insurance which it becomes necessary for insurance companies to charge depend upon the premiums received and losses sustained by them. To the end that insurance rates shall operate equitably, the Legislature has by section 65 of the Insurance Law (added by Laws of 1911, chap. 416, as amd. by Laws of 1918, chap. 141) provided against discrimination. It is important both to preserve the solvency of insurance companies and for the equitable application of the rates charged for insurance, that such rates shall be determined upon scientifically. Coinsurance clauses have frequently been declared to be just and reasonable and entirely consistent with the rule of indemnity, for they merely require the assured, as a condition of receiving a lower premium rate, to stand part of the loss himself, where he does not take out full insurance or insurance to the percentage of the value specified. (Belt v. American Central Ins. Co., 29 App. Div. 546; affd., 163 N. Y. 555; Buse v. National Ben Franklin Insurance Co., supra; Hartwig v. American Insurance Co., 169 App. Div. 60; Christian & Daniel v. Niagara Fire Ins. Co., 101 Ala. 634; Stephenson v. Agricultural Ins. Co., 116 Wis. 277; Penn. Fire Insurance Co. v. Moore, 51 S. W. Rep. 878; Quinn v. Fire Assn., 180 Mass. 560; Firemen's Fund Ins. Co. v. Pekor, 106 Ga. 1; Attorney-General v. Commissioner of Insurance, 148 Mich. 566; Ostrander Ins. [2d ed.] § 208.) It might, I think, fairly be assumed from the extent to which coinsurance clauses were in use in this State that the Legislature was aware of their use prior to the amendment of section 121 in 1917, but it clearly appears that it was, for in 1911 the Merritt commitee, so called, which was a joint legislative committee appointed in 1910, had those clauses under consideration and with respect thereto reported as follows: |