46 Ind. App. 114 | Ind. Ct. App. | 1910
Lead Opinion
Tbe Model Life Insurance Company was an Indiana-corporation, organized under tbe act of March 9,1897 (Acts 1897 p. 318, §§4739-4764 Burns 1908). Tbe Federal Life Insurance Company is an Illinois corporation. On February 6, 1900,' tbe Model Life Insurance Company issued a policy of insurance on the life of Alfred IT. Arnold, naming appellee as the beneficiary therein. This policy was issued by said company in consideration of an annual premium of
The assured paid five annual premiums to the company, the last of which was paid on February 5, 1904. On March 12, 1904, the Model Life Insurance Company and the Federal Life Insurance Company entered into a contract, by which the Federal Life Insurance Company took over to itself all the assets .of the Model Life Insurance Company, and undertook to reinsure the policy-holders of the Model Life Insurance Company, in accordance with the provisions of the contract entered into between the two companies, subject to the ratification of the members, and thereupon issued to the policy-holders of. the Model Life Insurance Company certificates purporting to evidence such contract of reinsurance, one of which certificates was issued to the assured, Alfred H. Arnold, and accepted by him.
The assured died after this contract was entered into, and before the lapse of the six years and two hundred forty-two days from the issuance of the policy of insurance on his life by the Model Life Insurance Company.
This action was brought against appellant upon the policy issued by the Model Life Insurance Company to the assured and the certificate issued by appellant to the policy-holder.
Appellant’s demurrer to the complaint was overruled, and an answer in four paragraphs filed. Appellee’s demurrer to the second, third and fourth paragraphs was sustained. There was a trial, resulting in a finding in favor of appellee. Appellant’s motion for a new trial was overruled, and judgment rendered on the finding in favor of appellee.
It is averred in the complaint that the assured and the plaintiff have duly performed all the conditions of the policy of insurance on their part to be performed. In the face of this averment, we think it devolved upon appellant to show by way of answer any fact that would defeat a recovery upon the policy.
It is true that the first section of the act under which the Model Life Insurance Company was organized (Acts 1897 p. 318, §4739 Burns 1908) provides that five or more persons may associate themselves together for the purpose of transacting life and accident insurance upon the ‘ ‘ assessment plan, ’ ’ for the purpose of mutual protection and relief of its members, and for the payment of stipulated sums of money to the families of deceased members.
Section seven of said act (§4745 Burns 1908), after providing for the accumulaton of a reserve fund for mortuary purposes, proceeds: “Nothing herein contained shall prevent the creation and accumulation of other funds in excess of the amount herein required to provide for the purposes of such corporation.” There is nothing contained in the act expressly prohibiting companies organized under it from contracting for- extended insurance, as it is denominated, or from collecting fixed premiums at fixed periods, .or limiting assessments to the actual amount required to meet the mortuary demands upon the company. On the other hand, the company is expressly authorized to fix the amount of premiums and the time of payment, and expressly authorized to determine the risks assumed and the duration thereof, and it is clearly authorized to accumulate funds beyond an amount sufficient to meet the mortuary demands upon the company. In the exercise of the power thus conferred by the statute, the Model Life Insurance Company fixed the premiums to be paid on the policy here sued on at $24.95, payable annually, and fixed the duration of the risk under the policy at six years and two hundred forty-two days, provided five of these annual premiums were paid as they came due. All of this was clearly within the express powers conferred by the law upon the corporation.
No error intervened in sustaining appellee’s demurrer to , the second paragraph of appellant’s answer.
The rights of the assured, Alfred H. Arnold, to insurance for six years and two hundred and forty-two days, under and by virtue of the policy issued to him by the Model Life Insurance Company, had, when this contract of reinsurance was entered into between the two companies, become fixed, and the Model Life Insurance Company had the funds presumably in its hands to meet its liability under this contract. These funds the Federal Life Insurance Company took into its possession under the contract of reinsurance, and while holding these funds it will not be heard to say that it is not liable to answer the demand the fund was created to meet, and any inconsistency between the terms of its contract with the Model Life Insurance Company and the contract of the Model Life Insurance Company under the- policy with the assured is not binding upon the assured. Federal Life Ins. Co. v. Kerr, supra.
There is no reversible error presented by the record. Judgment of the court below affirmed.
Rehearing
On Petition for Rehearing.
If appellant was correct in its contention that under this law the Model Life Insurance Company had no power to fix the premiums or assessments on its policies at such sum as would produce funds out of which the mortuary demands upon it, arising out of this feature of the contract could be paid, there might be some force in its contention, but these provisions of the law, to which our attention has been espe
Clearly, under this law, the board of control of the company has’ full power to fix the amount of premiums to be paid on its policies, and to require these premiums to be paid at certain fixed periods, precisely the same as may be done by any old line company, and the premiums and the periods of payment so fixed, so far as any right of the assured is concerned, are irrevocably fixed. Assured cannot insist on any change. The company can compel the payment as it has fixed it, or forfeit the policy, and the premium may be fixed at such sum as will create a fund not only sufficient to meet all mortuary claims that may arise under the contract of insurance as it has made it, but create an unlimited reserve beside. As shown in the original opinion, the law clearly contemplates the creation of such a reserve, and clearly contemplates the power of the board to raise such a fund as will give to its policies a withdrawal value.
There are many assessment plans of doing life insurance
-Appellant’s petition for rehearing overrruled.