Appeal from the Appellate Court for the First District; heard
in that court on appeal from the Circuit Court of Cook County,
the Hon. Richard Curry, Judge, presiding.
JUSTICE UNDERWOOD DELIVERED THE OPINION OF THE COURT:
The plaintiff, United States Fire Insurance Company, filed a complaint for declaratory judgment against its insureds, Barbara Schnackenberg and her son, Mark, and the plaintiff in the underlying personal injury action, Maria T. Strehlow. The company sought a declaration that its owners,' landlords' and tenants' liability policy with the Schnackenbergs afforded no coverage for the claim asserted against them by Maria Strehlow. The company's motion for summary judgment was granted by the circuit court of Cook County, the appellate court reversed (89 Ill. App.3d 431), and we granted the insurer leave to appeal.
Maria Strehlow alleged in her complaint that on September 3, 1975, she suffered personal injuries when struck by a bicycle ridden by Mark Schnackenberg as she was crossing the street at the intersection of Arlington Place and Clark Street in Chicago. It is undisputed that the accident took place approximately 2 1/2 blocks from the Schnackenberg home and that the bicycle was being used for pleasure purposes.
The coverage provision of the policy covering the two-family dwelling states:
"The company will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of
to which this insurance applies, caused by an occurrence and arising out of the ownership, maintenance or use of the insured premises and all operations necessary or incidental thereto * * *."
An endorsement attached to the policy states:
"1. The definition of `insured premises' is amended to read as follows:
`insured premises' means the premises described below (2444 N. Orchard, Chicago, Illinois) or designated in the policy as subject to this endorsement, including the ways immediately adjoining and including garages and stables incidental thereto, gardens incidental thereto on land not owned by the named insured, and individual or family cemetery plots or burial vaults."
The defendants contend that the riding of a bicycle for pleasure purposes is "incidental to" the use of residential premises and that, because coverage is provided for "maintenance or use of the insured premises and all operations necessary or incidental thereto," the accident involved here is covered. They also point to the express exclusion of coverage of injuries "arising out of the use of bicycles by or on behalf of the insured for trade, professional or business purposes," and argue this exclusion of business use indicates the existence of coverage for all other uses, including bicycle riding for pleasure or recreation. Even under a restrictive policy interpretation, say defendants, the terms of the policy are ambiguous and must be construed in their favor.
Generally speaking, if a provision of an insurance contract can reasonably be said to be ambiguous it will be construed in favor of the insured and against the insurer, who was the drafter of the instrument. (Dora Township v. Indiana Insurance Co. (1980), 78 Ill.2d 376; Glidden v. Farmers Automobile Insurance Association (1974), 57 Ill.2d 330.) However, if the provisions of the insurance policy are clear and unambiguous there is no need for construction and the provisions will be applied as written. (Menke v. Country Mutual Insurance Co. (1980), 78 Ill.2d 420; Kirk v. Financial Security Life Insurance Co. (1978), 75 Ill.2d 367.) All the provisions of the insurance contract, rather than an isolated part, should be read together to interpret it and to determine whether an ambiguity exists. Weiss v. Bituminous Casualty Corp. (1974), 59 Ill.2d 165; Cobbins v. General Accident Fire & Life Assurance Corp. (1972), 53 Ill.2d 285.
We suspect that it is usually, if not always, possible in cases involving the interpretation of contracts as complex as the modern insurance policy to isolate particular phrases or clauses which are then urged in support of the desired result. That approach does little, however, to resolve the problem. In applying the rules of interpretation, the words in the policy should be given ...