American law has long afforded the state and its subdivisions of government an immunity from liability for tort. The Federal Government, the state, municipal corporations, and quasi-municipal corporations of various types, are exempted from tort accountability for their wrongful acts.

In the past, the subdivisions which are the recipients of this immunity have not been reluctant to accept it. But criticism of this immunity, both as to the social merit of casting the entire burden of injuries caused by the activities of government on the individuals harmed rather than spreading the loss among the public for whose benefit the activities are carried on, and as to the theoretical and factual validity of the reasons which have been advanced for the existence of the rule, has been increasing in recent years. Because of this widespread dissatisfaction, the Federal Government and several states have by statute abrogated or limited in score the immunities to which they are otherwise entitled, and have in many areas permitted themselves to be sued for tort in the same manner as private individuals.

Responsive to the same feeling of moral responsibility to citizens injured through their activities which has motivated more autonomous units of government to waive their immunity by statute, officials of a number of subdivisions have attempted to provide protection for injured persons by securing policies of liability insurance. The right of the person injured by the activities of such an insured subdivision to recover for his damage, for which damage the subdivision would not in the absence of insurance be accountable, is the matter here in question.