54 Ga. App. 718 | Ga. Ct. App. | 1936
Lancaster, an employee of the Trion Company, filed suit against Travelers Insurance Company on a certificate issued to him under a group-insurance policy issued to the Trion Company. He alleged that he became permanently and totally disabled on June 9, 1933. Claim was filed, and payment was refused. The defendant answered that the policy so issued had been canceled by mutual agreement, on April 11, 1933, and that there was no liability on its part. The evidence showed that on April 11, 1928,* the company issued a group-insurance policy to the Trion Company, to be effective for a term of one year from that date, “and same may be renewed from year to year as hereinafter provided.” On December 14, 1932, the plaintifE was issued a certificate under the group policy, he being at the time an employee of the Trion Company. On April 11, 1933, the insurance company and the Trion Company canceled this policy, and issued a new and different policy. The defendant sent its agent to take up certificates issued under the canceled policy, and, where wanted, certificates under the new policy of group insurance were delivered. The plaintiff knew of this, and was instructed by the Trion Company to notify employees to surrender their certificates under the policy which was canceled. The plaintiff performed this duty, but refused to surrender his certificate under the old policy. He continued to pay to the Trion Company the amount which he had been paying under the old policy, which was accepted by the Trion Company, but was never sent or delivered to the insurance company. The plaintiff testified that the defendant’s agent who was taking up the certificates under the old policy and
The contracting parties in' group insurance are primarily the employer and the insurance company. “It is a contract between the insurer and the employer. . . It was not in the power of the beneficiary ‘ to keep the group contract in force’or to abrogate it.'” Curd v. Travelers Insurance Co., 51 Ga. App. 306, 310 (180 S. E. 249). The obligations or covenants of the insured are not contained in the certificate. Metropolitan Life Insurance Co. v. Harrod, 46 Ga. App. 127, 128 (166 S. E. 870). The group or master policy, manifestly and by its express terms, is an agreement between the insurance company and the employer. Johnson v. Metropolitan Life Insurance Co., 52 Ga. App. 759, 763 (184 S. E. 392); Austin v. Metropolitan Life Insurance Co., (La. App., 142 So. 337). The certificate to the employee is an evidence of his coverage by the master policy. All-States Life Insurance Co. v. Tillman, 226 Ala. 245 (146 So. 393). The “certificate” does not constitute the entire contract of insurance. In brief, the insurance company agreed for a named consideration to insure for one year a group of employees of the Trion Company, whose identity was to be determined by the possession of one of a large number of “certificates.” The “certificate” refers to the policy as the basis of its issuance, and the policy refers to the “certificate.”
An agent of the insurance company who comes to deliver certificates under a new master policy which is being issued to the Trion Company, and to take up the certificates under the prior policy, under the express terms of such policy is without authority to hold the same in effect for a particular purpose, where it appears that the company has neither accepted any premiums thereunder, nor received any consideration for so doing, but on the contrary, expressly and in writing, has agreed with the Trion Company to cancel said policy. The payment by the employee to the Trion Company of certain amounts of money as premiums, where it appears that the insurance company never received the sums so paid, nor were they tendered to it, will not. bind such insurance company. Thus, if the insurer was not to be bound by the alleged misrepresentation of this special agent, Mitchell, and if neither the employer nor the employer’s agent is an agent of the..insur
“The claim that the employer is the agent of the insurer in the collection and forwarding of premiums is wholly without foundation. By the express terms of the policy the company looks to the employer for the payment of the premiums. It has no concern with whether it collects part of them from the employee or not. The employee is insured because he has made application, and because the employer promises to pay the insurer the premiums. The promise to pay is for the benefit of the employee. Again, it is urged that as the provisions as to notice of claim, proof of loss, etc., are contained in the master policy, therefore the employer is the insurer’s agent to give information on these subjects. It is said that the whole purpose of the group-insurance scheme would be frustrated unless the employer co-operates with the employee as agent “by implication’ .for the insurer. That the employer is expected to co-operate with the employee is evident. The whole scheme is paternalistic. The error of counsel, here and elsewhere, is in failing to appreciate that the paternalism is that of employer towards employee. It does not have the effect of making the benevolent parent the agent of the party with whom he inaugurates a contract for the benefit of his children. The line dividing the three parties to the contract according to their interest and real position in these transactions puts the employer with the employee, as opposed to the insurer. Much is made in argument of the proposition that the whole plan and scheme was to furnish protection to the insured. Of course this is true, but it does not follow that the insurer is made chargeable with the conduct of the intermediary who sought to bring the insurer and the insured into relation, who offered and bound itself to pay to the insurer the price demanded for the insurance, and who agreed to perform the office of keeping the insurer informed as to who had accepted, and come under the terms of, the offer. The em
Under the group-insurance policy, the employer is acting for itself and on behalf of its members in order to obtain cheap insurance for them through a group plan. It is representing itself and its members, not the insurance company. Its only authority is to issue a certificate of insurance to its employees and-to remit the premium therefor to the insurance company, but this does not make it a general agent. The employer is not in the insurance business, but is rendering all the service it can for its employees. It receives no compensation from the insurance company. The latter has.no control over its- rules for hiring and firing its employees, nor has the insurance company any control over the employer as to whether it pays all of the insurance premium or only a part of it, except under the provision in the policy “that no employee shall be charged more than fifteen per cent, per week each per thousand of insuranpe.” As far as the insurance company is concerned, the difference between the insurance in this case and the case of an individual is that here a single group is being insured rather than a single person, with a resultant saving to the members of the group, and the employer and the employees are-all members of this group. Thus, the-line dividing-the three parties to the contract, - the employer, employees, and insurance company, according to their interest and real position in these
Judgment affirmed.