Kingsford v. Business Men's Assurance Company of America

• Court: Idaho Supreme Court
• Writing for the Court: MORGAN, C. J.
• Citation: Kingsford v. Business Men's Assurance Company of America, 68 P.2d 58, 57 Idaho 727 (Idaho 1937)
• Decision Date: 14 May 1937
• Docket Number: 6427
• Parties: DELLA KINGSFORD, Respondent, v. BUSINESS MEN'S ASSURANCE COMPANY OF AMERICA, a Corporation, Appellant

68 P.2d 58

57 Idaho 727

DELLA KINGSFORD, Respondent, v. BUSINESS MEN'S ASSURANCE COMPANY OF AMERICA, a Corporation, Appellant

No. 6427

Supreme Court of Idaho

May 14, 1937

INSURANCE-CONTRACT CONSTRUCTION OF-DISABILITY CLAUSE-WAIVER OF PREMIUM-PROOF OF DISABILITY.

1. Insurer which denied liability of life policy on ground that policy had lapsed and which refused to furnish blanks on which to make proofs of beneficiary's right to insurance waived right to further proof, notwithstanding insurer's letter denying liability contained statement that denial did not waive any terms of policy.

2. Contracts of insurance must be construed in view of their general objects, avoiding strict and technical interpretation.

3. Where language of policy may be given two meanings, one of which permits recovery and other which does not, it is to be given construction most favorable to insured.

4. Life policy provision that proof shall be made that disability has continued for period of at least four consecutive months and that notice of claim for exemption from payment of premiums must be received at home office of insurer during lifetime of insured and during continuance of total disability, otherwise claim should be invalid, held inapplicable in case where disability terminated in death.

5. Use in life policy of words "total and permanent disability benefits" justifies construction that every disability though total, does not render insurer liable to carry insurance without premium, but, to invoke that benefit disability must have permanency within meaning of policy, and disability which continues from time it is incurred until death of victim is "permanent."

6. Under life policy which exempted premium payments if proof was made during lifetime of insured that disability continued for four consecutive months, insurer held liable notwithstanding policy lapsed on December 14, 1933, and proof was not made until January 29, 1934, where insured became disabled on November 11, 1933, and died on January 13, 1934 and premiums agreed to be waived were those accruing after commencement of disability.

APPEAL from the District Court of the Eleventh Judicial District, for Minidoka County. Hon. T. Bailey Lee, Judge.

Action to recover on life insurance policy. Judgment for plaintiff. Affirmed.

Affirmed. Costs awarded to respondent.

Merrill & Merrill, for Appellant.

The contract of insurance involved in this case provides that if the insured becomes totally disabled while the insurance under the policy is in full force, upon receipt at its home office of due proof of such disability and that it has continued for a period of at least four consecutive months the company will waive payment of any premium falling due after the commencement of such continuous total disability. When the premiums are in default the policy lapses unless each one of these three conditions, namely: (a) total disability, (b) it is continuous for four months, and (c) receipt of proof of those facts, exist. These are conditions precedent to recovery. They must be alleged and proved, failing in which no recovery can be had. (Egan v. New York Life Ins. Co., 229 Ill.App. 15; Himelbloom v. Metropolitan Life Co., 80 F.2d 339; Western & Southern Life Ins. Co. v. Smith, 41 Ohio App. 197, 180 N.E. 749; Courson v. New York Life Ins. Co., 295 Pa. 518, 145 A. 530; Brams v. New York Life Ins. Co., 299 Pa. 11, 148 A. 855.)

Death of the insured terminates the period of disability. It does not extend it. (Hanson v. Northwestern Mut. Life Ins. Co., 229 Ill.App. 15; Himelbloom v. Metropolitan Life Ins. Co., 128 Neb. 52, 257 N.W. 525.)

H. A. Baker, for Respondent.

The purpose of the "Disability Benefit" provision was to prevent lapsation of the policy during disability. (Minnesota Mut. Life Ins. Co. v. Marshall, 29 F.2d 977; Missouri State Life Ins. Co. v. LeFevre, (Tex. Civ. App.) 10 S.W.2d 267; Mid-Continent Life Ins. Co. v. Harrison, 175 Okla. 543, 53 P.2d 266; Northwestern Mut. Life Ins. Co. v. Carneal, 262 Ky. 665, 90 S.W.2d 1010.)

There are two classes of disability contracts in one of which proof of disability is the condition precedent and in the other class disability is the condition precedent. (New York Life Ins. Co. v. Riggins, 178 Okla. 36, 61 P.2d 543; Jefferson Standard Life Ins. Co. v. Pierce, 264 N.Y. 698, 95 S.W.2d 579.)

The provisions of the policy of insurance involved in this case bring it within the second of the above classes and make disability, not the proof thereof, the effective incident. (Minnesota Mut. Life Ins. Co. v. Marshall, supra; Aetna Life Ins. Co. v. Davis, 187 Ark. 398, 60 S.W.2d 912; National Standard Life Ins. Co. v. Smith, (Tex. Civ. App.) 75 S.W.2d 1102.)

By denying liability upon the ground that the disability benefits were not available because insured had failed to live for the period of four months after becoming disabled, the company is estopped to urge and has waived the contention that notice of disability is a condition precedent. (Allen v. Phoenix Assur. Co., 12 Idaho 653, 88 P. 245, 10 Ann. Cas. 328, 8 L. R. A., N. S., 903; Herschman v. John Hancock Mut. Life Ins. Co., 284 N.Y.S. 561; Missouri State Life Ins. Co. v. Carroll, 174 Okla. 142, 50 P.2d 148; Federal Life Ins. Co. v. Lewis, 76 Okla. 142, 183 P. 975, 5 A. L. R. 1637.)

Where the right to waiver of premiums attaches as of the commencement of a total, continuous disability which results in death, the rights of the parties are the same as though death had occurred at the time such disability began and there is no more reason for requiring proof of disability as a condition precedent in one case than for requiring proof of death as like condition in the other case. (Minnesota Mut. Life Ins. Co. v. Marshall, supra; Life Ins. Co. of Virginia v. Williams, 48 Ga.App. 10, 172 S.E. 101.)

MORGAN, C. J. Holden, Ailshie and Givens, JJ., concur.

OPINION

MORGAN, C. J.

--Respondent is the beneficiary named in a policy of insurance written by appellant on the life of her sister, Emma Kingsford, May 13, 1931. The premiums, which were payable quarterly, were paid to and including that which fell due August 13, 1933. Thirty-one days grace is provided in the policy for the payment of each premium, so that the payment made August 13, 1933, continued the policy in force until December 14 of that year. The insured died January 13, 1934. Payment of the insurance was refused on the ground the policy had lapsed for nonpayment of the last premium due before the death of insured. This action was commenced and prosecuted on the theory that payment of that premium was waived by the terms of the policy because of total, permanent disability of insured at the time it became due. Trial to the district judge, without a jury, resulted in judgment for plaintiff for the amount of insurance provided for in the policy, together with interest thereon and costs. The appeal is from the judgment.

The provisions of the policy, understanding of which is necessary to a decision of the case, are as follows:

"Total and Permanent

"Disability Benefits

"1. If the assured shall become totally disabled, physically or mentally, as the result of bodily injuries or disease, so that he is wholly prevented from performing any work, following any occupation, or engaging in any business for remuneration or profit, and if such injuries are received or disease contracted and the disability resulting from such injuries or disease shall begin while the insurance under this policy is in full force and before the anniversary of the policy on which the assured's age at nearest birthday is sixty, upon receipt at its Home Office of due proof of such disability, and that it has continued for a period of at least four consecutive months immediately preceding receipt of proof, the Company will, during the continuance of such disability, waive the payment of any premiums falling due after the commencement of such continuous, total disability, the premium waived to be the annual, semi-annual, or quarterly premium, according to the mode of payment in effect when disability occurs, but no premium falling due more than six months prior to receipt at the Home Office of the Company of written notice of claim hereunder will be waived.

"When Premium

"is Past Due

"2. In case any premium is in default before receipt at the Home Office of the Company of written notice of claim hereunder, waiver of premium shall be granted only if the total disability for which claim is made commenced before the termination of the grace period for payment of the first premium in default, and if written notice of the claim hereunder is received at the Home Office within six months from the due date of such unpaid premium. Then, if the claim is otherwise valid, it shall be allowed and the assured shall be liable to the Company for such premium in default with interest at 6% per annum, which amount may be deducted from any amount due the assured.

"Notice of

"Claim

"3. Written notice of claim hereunder must be presented to, and received at, the Home Office of the Company during the lifetime of the assured, and during the continuance of total disability; otherwise, the claim shall be invalid, provided, however, that failure to give such notice within such times shall not invalidate such claim if it shall be shown that it was not reasonably possible to give such notice within such times and that such notice was given as soon as was reasonably possible."

Appellant contends its obligation to waive premiums occurs only in case (1) insured becomes totally and continuously disabled and, (2) disability has continued for a period of at least four consecutive months and, (3) receipt by it of proof of these facts.

The evidence shows, and the trial judge...