§ 2.1 General Rules of Policy Language Construction

• Library: Guide to South Carolina Liability and Property Insurance Law (SCBar) (2019 Ed.)

§ 2.1 General Rules of Policy Language Construction

In South Carolina, an insurance policy is subject to the general rules of contract construction.¹ Therefore, insurance policies are subject to the ordinary rules of contract construction.² The cardinal rule of contract construction and interpretation is to ascertain the parties' intent.³ To determine the intent of the parties and the meaning of the document, courts will review the entire contract.⁴ A clause in a policy will not be read in isolation.⁵ The construction of a clear and unambiguous contract is a question of law for the court to determine.⁶

If the contract's language is clear and unambiguous, the language of the policy alone will determine its force and effect.⁷ This is true because "[c]ourts must enforce, not write contracts of insurance, and their language must be given its plain, ordinary and popular meaning."⁸ Further, South Carolina courts will not "torture the meaning of policy language in order to extend or defeat coverage that was never intended by the parties."⁹ In addition, South Carolina courts do not have the "power to interpolate into the agreement between the insurer and the insured a condition or stipulation not contemplated either by the law or by the contract between the parties."¹⁰ Courts "are without authority to alter a contract by construction or to make new contracts for the parties" as their "duty is limited to the interpretation of the contract made by the parties themselves, regardless of its wisdom or folly, apparent unreasonableness, or failure to guard their rights carefully."¹¹ An insurance policy should not be interpreted in an unreasonable manner so as to enlarge or to restrict its provisions beyond what is reasonably contemplated by its term and courts should not strain to find ambiguity in a policy where none exists.¹²

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Notes:

^[1] Mid-South Ins. Co. v. Doe, 274 F. Supp. 2d 757, 761 (D.S.C. 2003); Auto Owners Ins. Co. v. Rollison, 378 S.C. 600, 663 S.E.2d 484 (2008); Coakley v. Horace Mann Ins. Co., 376 S.C. 2, 656 S.E.2d 17 (2007); Hansen ex rel. Hansen v. United Servs. Auto. Ass'n, 350 S.C. 62, 565 S.E.2d 114, 116 (S.C. Ct. App. 2002); Estate of Revis v. Revis, 326 S.C. 470, 484 S.E.2d 112 (Ct. App. 1997); see generally S.C. Code Ann. § 38-61-10 ("All contracts of insurance on property, lives, or interests in this State are considered to be made in the State . . . and are subject to the laws of this State.").

^[2] Whitlock v. Stewart Title Guar. Co., 399...