Collins v. Metropolitan Ins. Co.

• Decision Date: 17 January 1935
• Parties: AMANDA COLLINS v. METROPOLITAN LIFE INSURANCE COMPANY.
• Court: Virginia Supreme Court

Page 833

163 Va. 833

AMANDA COLLINS v. METROPOLITAN LIFE INSURANCE COMPANY.

Supreme Court of Virginia, Richmond.

January 17, 1935.

Present, All the Justices.

1. INSURANCE — Construction of Policy — Duty of Court to Construe Contract Which Parties Make. — Undoubtedly policies of insurance are to be liberally construed in favor of the assured, and the Supreme Court of Appeals has uniformly so held but courts have no power to write contracts for people. Their duty is to construe those which they themselves have made.

2. INSURANCE — Section 4228 of the Code of 1930 — Application. — Section 4228 of the Code of 1930, the incontestable statutory provision, does not apply where premiums have not been paid and it does not apply to losses not covered by it.

3. INSURANCE — Group Policy — Provision for Disability Benefits — Claim for Death Benefits after Employment Ceased — Case at Bar. — In the instant case, an action on a policy of group insurance, it was provided in the policy that upon termination of active employment, the insurance automatically terminated. The assured left the service of the company by which he was employed in June, 1930, at which time, it was contended, he was totally disabled, and he died in August, 1932. Provision was made in the policy for sick benefits upon total and permanent disability and that upon due proof of disability payment of premiums thereafter becoming payable was waived during the continuance of the disability. A claim for disability benefits, made about a year after the assured left his employment, was rejected and nothing further was done until the demand for death benefits was made. It was argued from the provision for waiver of payment of premiums after proof of disability that death benefits continue after disability has set in.

Held: That death benefits do continue after disability but subject to two provisions: Premiums must have been paid up to the date of due proof and the employee must not have voluntarily, definitely severed his relations with the company. In the instant case assured definitely quit the service of the company and the policy was under its express terms automatically cancelled by his action.

Error to a judgment of the Corporation Court of the city of Danville in a proceeding by motion for a judgment for money. Judgment for defendant. Plaintiff assigns error.

The opinion states the case.

Percy T. Stiers, for the plaintiff in error.

Harris, Harvey & Brown and Grasty Crews, for the defendant in error.

HOLT, J., delivered the opinion of the court.

Amanda I. Collins was the wife of Pleny S. Collins, now dead. Her husband was at one time an employee of Riverside and Dan River Cotton Mills, Incorporated. As such he was one of the beneficiaries under a policy of group insurance issued to the Cotton Mills Company by the Metropolitan Life Insurance Company. The original policy bears date January 1, 1920. It was a one year renewable term policy — was in fact renewed from time to time and was last renewed on January 1, 1930, and terminated on August 31, 1930.

This provision was made for the issuance of individual certificates: "The company will issue to the employer for delivery to each employee insured hereunder an individual certificate, showing the protection to which each employee is entitled." Such a certificate was issued to Collins on January 3, 1929. In it this appears:

"If death occur while the employee is in the employ of the employer and while said group policy is in force, the amount of insurance in force thereunder on said employee will be paid to Amanda I. Collins, beneficiary."

Five hundred dollars was the minimum death benefit coupled with the further provision that this sum was to be increased by $100 during each year of continuous employment until a maximum of $1,500 had been reached.

Collins left the company's service in June, 1930. He was then, it is contended, totally disabled and he did die of pellagra on August 23, 1932. Death benefits, $500, the face of his certificate, plus one year's increase of $100 were then due on that account if anything was due. This is the claim made and it is for that sum that this action is brought.

Under the original policy and under the certificate of January 3, 1929, any employee who had been in the service of the company for three months (later changed to one year), was entitled to sick benefits if, before the age of sixty, he became wholly and permanently disabled by accident or disease and furnished to the company at its home office due proof of that fact. If he left the company he had the right to take out, without evidence of insurability and within thirty-one days of date of the termination of his employment, an ordinary life policy in amount equal to the protection which he received when he severed his connection with the company. The employee also had the right to designate the beneficiary who was to take if death occurred "while the employee is in the employ of the employer."

As we have seen in this case the wife was the designated beneficiary and it is important to remember that this is an action brought to recover death benefits, and not disability benefits.

Premiums were paid wholly by the company and were paid in monthly installments which varied automatically with its employment roll. Monthly statements were submitted to the insurer showing the names of those who had been added to the company's force and those who had left its service.

Collins had been in its employment for something like ten years, and, as we have seen, left its service in June, 1930, and died of pellagra on August 23, 1932. Disability benefits were claimed and proof of disability was received by the insurer on June 9, 1931. This claim after investigation the company rejected. Nothing further was done until after Collins' death, when the demand for death benefits, set out in this action, was made.

At the trial, and after all the evidence was in, the court, on motion of the defendant, struck out all that which had been offered by the plaintiff. Thereupon the jury brought in a verdict for the defendant which the court confirmed by judgment.

If there was no evidence which could have supported a verdict, then, in accordance with settled practice, the court, of course, was right.

Only employees are insured. In provision 6 on the policy itself, this appears: "Upon termination of active employment, the insurance of any discontinued employee under this policy automatically and immediately terminates and the company shall be released from any further liability of any kind on account of such person unless an individual policy is...