Opinion
36589.
DECIDED APRIL 2, 1957. REHEARING DENIED APRIL 24, 1957.
Beneficiary's action on insurance policy; nonsuit. Before Judge Little. Brunswick City Court. September 6, 1956.
E. Way Highsmith, Anthony A. Alaimo, for plaintiff in error.
L. J. Bennet, Reese, Bennet Gilbert, contra.
Where, as here, an applicant for life insurance died before the issuance of the policy of life insurance and before the acceptance and approval of the application by the home office of the defendant and before payment of the required premium amount, the beneficiary could not, under the terms of the written application and receipt forms in this case, recover the face amount of the policy of insurance contemplated by this transaction. Accordingly, the trial court did not err in granting a nonsuit on motion of the defendant.
DECIDED APRIL 2, 1957 — REHEARING DENIED APRIL 24, 1957.
Albert G. Kammerer filed an action in the City Court of Brunswick alleging that he was beneficiary of a policy of life insurance in full force and effect with the defendant Metropolitan Life Insurance Company on the life of the insured Albert G. Kammerer, Jr.; that his son on August 7, 1951, made application for life insurance with the defendant's agent, who accepted from the applicant the sum of $10 representing the first full premium for said insurance; that said application was approved by the defendant within 30 days thereafter and given the number 65091AHD but was not delivered to plaintiff's son prior to his death on August 14, 1951, and defendant now refuses to deliver the same. The receipt issued to the insured at the time of the $10 payment contained the following language, the first two sentences of which also appear in the application form: "If the sum collected at the time the application is signed is equal to the full premium on the policy applied for and if such application is approved at the company's home office within 30 days thereafter for the class, form, and amount of insurance therein applied for, then the insurance applied for shall be in force from the date of the application. Otherwise, the company shall incur no liability under said application until it has been received and approved and a policy has been issued and delivered, and the full premium specified in the policy has actually been paid to and accepted by the company, in which case such policy shall be in force from the date of issue specified therein. The above sum shall be refunded if the application is declined or if a policy is issued other than as applied for and is not accepted by the applicant. If the company offers, upon payment of the balance of the full premium, to deliver to the applicant the policy as applied for, and the offer is refused, the company will retain from the above sum the amount of $1 to help defray the cost of issuing such policy and will return the balance, if any, to the applicant upon surrender of this receipt."
The defendant answered, denying that a policy had ever been issued and denying that a full premium had been paid, but alleged that such policies are only issued on payment of not less than quarterly premiums of $31; that the plaintiff's son was informed that unless this sum was paid at the time of the execution of the application, the company would incur no liability until the application had been received and approved and a policy issued and delivered, and the plaintiff's son said he would pay the balance upon delivery.
On the trial of the case, the plaintiff attempted to prove the policy in question had been issued by showing that on other issued policies the defendant stamped upon a policy of insurance the same number which appeared on the application. The chief underwriter of the defendant, called for cross-examination, then testified that it was his responsibility to determine the acceptability of all applications for insurance; that no policy of insurance had been issued because the policy was being held for medical and credit reports when word of the applicant's death reached the company; that the number stamped on the application is followed by the letters "AHD" which means no action was ever taken on the application, and that accordingly no such policy existed as alleged in the petition. The plaintiff then closed, and the defendant made a motion for nonsuit which was granted by the court. The exception is to this judgment.
1. "Where, in consideration of a payment made to an insurance company of a certain stipulated amount of money as a premium for life insurance, the company agrees that upon the approval at the home office of the application for the issuance of the policy, the company will, in the event of the death of the person to be insured prior to the issuance of the policy, pay to the beneficiary the amount of the insurance which would have been due had the policy been issued, there arises no contract of insurance in the absence of an approval of the application at the home office." Hill v. Life Casualty Ins. Co., 51 Ga. App. 578 (1) ( 181 S.E. 104). In such circumstance, the application must be approved before the conditional receipt constitutes a temporary policy of insurance, and, so long as the application is not acted upon, no contract of insurance is consummated. Paulk v. State Mutual Life Ins. Co., 85 Ga. App. 413 ( 69 S.E.2d 777). Where the receipt is a binder conditioned upon approval of the application by the company at its home office, the insurer becomes obligated upon acceptance and approval of the application. National Life c. Ins. Co. v. Moore, 83 Ga. App. 289 ( 63 S.E.2d 447). See also Smith v. Metropolitan Life Ins. Co., 76 Ga. App. 229 ( 45 S.E.2d 471.) The uncontradicted evidence in this case being, that, while the application was being processed, and before approval or rejection, the applicant died and the company thereafter refused to approve the policy, the plaintiff failed to carry the burden of proving that the application had been "approved at the company's home office within 30 days" as required by the terms of the binder in cases where the full premium is paid in.
2. Further, the plaintiff alleged that the amount paid at the time the application was made was $10 "prepresenting the first full premium for said insurance." The answer denied that this amount constituted a full premium. Unless such amount is "equal to the full premium on the policy applied for," under the terms of the application, the company would incur no liability until after approval of the application and actual delivery of the policy and payment of the full premium. The plaintiff failed to offer any evidence to show that the amount paid constituted a full premium, and accordingly failed in this respect also to prove his case as laid.
3. Whether or not the defendant tendered back the $10 which, under the terms of the application, it was bound to do on refusing to issue a policy, is a matter of defense. Nothing in the record suggests whether or not such a tender was made. In the absence of evidence that the defendant refused to return the deposit it cannot be presumed, as contended, that the insurer refused to do so and thereby became bound by the contract. Accordingly, the absence of evidence on this subject affords no ground for reversal.
The trial court did not err in granting the judgment of nonsuit.
Judgment affirmed. Gardner, P. J., and Carlisle, J., concur.