The Rule Of Plain Meaning
The insurer and the insured are bound by the plain and unambiguous terms of the insurance contract. In construing a contract, a court first “determine[s] if the instrument’s language is clear and unambiguous.” “If the language is unambiguous, the court simply enforces the contract according to the terms, and looks to the contract alone for the meaning.”
The plain terms of an unambiguous policy are given full effect even though they are beneficial to the insurer and detrimental to the insured. The cardinal rule of contract construction is to ascertain the parties’ intent, so that when the terms of the contract are clear and unambiguous, the court looks to the contract alone to determine that intent. Construction and interpretation of contracts are generally matters of law for the court.