18 Ohio App. 164 | Ohio Ct. App. | 1924
Gillespie brought bis action in tbe Common Pleas upon a matured endowment life insurance policy issued to him by tbe defendant in 1902. The policy was for $1,000. The plaintiff claimed that he was entitled to the face of the policy, plus $523 surplus, subject to a loan previously made him of $925.53, and that the net amount owing him at the maturity of the policy was $597.47. The defendant at the conclusion of plaintiff’s testimony tendered judgment for $161.06, on the theory that the plaintiff was entitled to a surplus above the face of the policy of $86.58, instead of the $523 claimed by plaintiff. After the case had been finally submitted to the jury the trial court sustained a motion of the defendant and directed a verdict for the plaintiff for the amount conceded by the defendant, and to the judgment that followed error is now prosecuted by the plaintiff.
The undisputed evidence is that the amount of surplus actually apportioned to the policy sued upon was. $86.58. The question at issue, therefore, is whether the plaintiff was entitled to the surplus so apportioned or was entitled to the surplus of $523 claimed by him.
Among the provisions of the policy was one covering the question at issue in the following language :
“Third. That at the end of the endowment period, provided this policy is in full force, the company will declare a dividend to the insured*166 or assigns of the share of the surplus then found by its actuary to be apportionable to this policy, which dividend may be drawn in cash, together with the endowment; or total cash value may be converted into a paid up policy (subject to medical examination and the company’s approval for any excess in paid up insurance over the amount of the original policy).”
Preceding the provision quoted was a table of loan values, surrender values and paid up continuing insurance values.
If the foregoing were all the pertinent provisions of the contract between the parties, there could be no question that the position of the company was sound, and that the plaintiff was entitled only to the increase of $86.58 actually apportioned by the actuary, unless such apportionment was impeached as unfair, and no such impeachment was attempted. The plaintiff, however, relies upon an additional paper, entitled “Illustration for Endowment Policy,” pinned to the policy at the time it was delivered to the plaintiff by the agent who solicited him. This paper recites the same loan values, surrender values, etc., that appear in the body of the policy heretofore mentioned. At the bottom of the “illustration,” and following the tables, appears this language not found in the policy proper.
“If the insured be living and the policy is in force at the end of twenty years, the insured or assigns will be credited with an equitable share of the surplus then found by the Actuary of the Company to be apportionable to the policy. Assumed surplus $523 which will be paid in cash together with the endowment of $1,000; Total $1,523,
The italicized word and figures are made by pen, the remainder is printed matter.
It is clear from the record that the company never authorized the soliciting agent to attach this illustration to the policy and make it a part of the contract. It is equally clear that such solicitor did attach it to the policy and that the policy as delivered had the illustration attached by a pin thereto.
The claim of the plaintiff is that the action of the agent in making the illustration a part of the contract is binding upon thé company within the doctrine laid down in Foster v. Scottish Union & Natl. Ins. Co., 101 Ohio St., 180. That was a case of fire insurance where the policy provided against liability if the building covered was. situated on property not owned by the insured in fee simple. The building was in fact situated on á leasehold. The agent of the company knew that it was a leasehold before the policy was issued and the premium paid. The insured, however, did not
If the plaintiff is entitled to the construction claimed by him it must be on some other grounds. It is claimed that such other grounds are present because on several occasions the insured returned the policy in question to the home office of the company, where the officers could have, and in the course of business would have, observed that the illustration was pinned to the policy. The company’s officers answer that on the occasions when the policy was returned to the home office none of them saw or had occasion to see the attached illustration and that they were ignorant of its existence until after the policy had matured. Whether the company did or did not know of the existence of the illustration was a question of fact, and as the trial judge in directing a verdict was bound to give the evidence that interpretation most favorable to the plaintiff it must now be assumed that
It is undisputed that under the policy sued on Gillespie was to pay $49.07 premium per year. Of this, $8.26 went to the General Fund, where it was available for expenses and any purpose for which the company needed it. The balance, $40.81, went to the reserve fund. This reserve fund so built up by this and other policy holders, with the earnings thereof, constitutes a sort of trust fund, under the supervision of the state, and is to be used in paying death claims as they arise and endowments when due. If the insurer preserves its solvency it must have placed in the reserve an amount which, with the earnings thereof, will be sufficient to meet the claims when they become payable by death or otherwise. The experience of mankind has taught that men of insurable condition can reasonably be expected to live a certain
While we adhere to the view expressed by the majority of the authorities that the unsigned illustration attached to the policy with the company’s knowledge does not become a part of the contract, and can not alter the liability fixed by the policy proper, we will assume for the purpose of the instant cáse that the company is estopped from denying the illustration a place
“Assumed surplus $523 which will be paid in cash together with the endowment of $1,000; Total $1,523 or, total cash value may be used as a single premium in purchase of paid up insurance $3,244.”
This language is unfortunate. It is indeed much worse and approaches dishonesty, for it allows a casual reader to emphasize the figures and words “$523, which will be paid in cash,” and may lead him to overlook the fact that the surplus which forms the only fund out of which it can be paid is “assumed” and cannot be determined until the twenty-year term of the policy has run. The illustration concludes:
“The company is purely mutual and the expenses of management limited and inflexible. All profits belonging to and will be paid to persistent policy holders.”
This was a statement of fact and law that did not affect the relations of the parties one way or another. The company was mutual and its expenses limited to the amount fixed in the policy as apportioned to the general fund.
While one sentence of the illustration is misleading, and so drawn as to enable a prospective policy holder to be deceived, and while it is likely that Gillespie was deceived in this transaction, nevertheless the conclusion is reached that he ought to have realized that the terms of the contract are to be determined not by what an agent ■ says, or does, and not by what a part of a sentence may recite, but by the policy as a whole.
The principle that where a policy of insurance
Judgment affirmed.