134 F.2d 246 (8th Cir. 1943), 12441, Aetna Life Ins. Co. v. Meyn

Docket Nº:12441.
Citation:134 F.2d 246
Party Name:AETNA LIFE INS. CO. v. MEYN et al.
Case Date:March 05, 1943
Court:United States Courts of Appeals, Court of Appeals for the Eighth Circuit
 
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Page 246

134 F.2d 246 (8th Cir. 1943)

AETNA LIFE INS. CO.

v.

MEYN et al.

No. 12441.

United States Court of Appeals, Eighth Circuit.

March 5, 1943

Page 247

E. R. Morrison, of Kansas City, Mo. (R. L. Hecker and Morrison, Nugent, Berger, Byers & Johns, all of Kansas City, Mo., on the brief), for appellant.

Walter R. Barnes, of Kansas City, Mo., for appellees.

Before GARDNER, JOHNSEN, and RIDDICK, Circuit Judges.

RIDDICK, Circuit Judge.

This suit was brought by the appellees, beneficiaries in a policy of insurance upon the life of William F. Meyn, to recover the sum insured by the policy. From a judgment in their favor at a trial without a jury the insurance company appeals.

There is no dispute concerning the material facts. William F. Meyn was insured by the appellant insurance company under a policy of life insurance expiring on the 5th day of March 1935. The policy was a seven-year term, nonparticipating, convertible contract of insurance, under which the insured acquired the right, at any time before its expiration, to exchange it for a level premium whole life or endowment policy for an amount not in excess of the amount insured. Under the conversion privilege of the policy, the insured had the right to have the new policy bear the date of the exchange of the policies or the date of the convertible policy. In the latter event insured was required to pay the difference between the premiums already paid on the convertible policy, for an amount of insurance equal to that of the new policy, and those that would have been required under the new policy, with interest at six per cent per annum. The premiums under the policy were payable quarterly upon the 5th days of March, June, September, and December. On January 5, 1935 the insured made application to the appellant company for the exchange of his term policy for a nonparticipating, modified life policy in the sum of $2, 500, with provisions for waiver of the payment of premiums in case of the insured's total and permanent disability, and for the payment of double the amount insured in the event of the policyholder's death from accident. The application for conversion to the new policy was in writing signed by the insured, and contained a request that the new policy be dated September 5, 1934 and the following agreement: 'I agree that the acceptance by me of any policy issued on this application is to be regarded satisfactory and shall constitute a ratification of the manner in which the policy is written and of any corrections, additions, or changes in this application made by the Company, and that all insurance under said Term policy, or portion thereof converted as herein requested, shall thereupon cease. ' Typed on the application were the words 'Automatic Premium Loan Provision.'

The appellant insurance company accepted the application and issued the policy of insurance involved in this suit. The application for the exchange of policies was made on the last day remaining for the payment by insured of the quarterly premium of $16.40 due on the original policy as of December 5, 1934. The amount of the quarterly premium on the new policy was $14.25, to be paid to the company on

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or before the 5th days of September, December, March, and June of each year for the first five years of the policy, and $27.55 thereafter during the lifetime of the assured. Since the new policy, by agreement of the parties, was dated on the 5th day of September 1934, two quarterly premiums were due at the time of the application for the new policy and at the time of its delivery to the insured, one being due on September 5, 1934 and one on December 5, 1934. The payment of these premiums was arranged by payment of the quarterly premium due on the old policy at the time of the application for conversion, amounting to $16.40, plus $10, and by the payment of the balance of $2.10 on January 21, 1935, the delivery date of the new policy. The effect of this arrangement was that the premium due December 5, 1934 on the original policy was applied to the payment of the premium due on the new policy.

The new policy contained the following provisions on the questions presented here:

'Request having been made in the application for this policy for the operation of the automatic premium loan provision herein, this endorsement shall be deemed to make said provision effective until revoked.

* * *

* * *

'If due written request for the operation of this provision has been filed at the Home Office of the Company before default in payment of premium, thereafter until a written revocation of said request has been filed with the Company, the amount of any premium not paid...

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