Case ID: nys_99/html/0891-01.html
Source: Caselaw Access Project
Author: {"author": "JOHN M. KELLOGG, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

McGUIRE v. UNION MUT. LIFE INS. CO.
    (Supreme Court, Appellate Division, Third Department.
    June 27, 1906.)
    Insurance — Life Policy — Extended Insurance — Stipulations — Construction..
    An Insured, in a 10-year term life policy, which stipulated for an annual premium of $134.60, and which authorized the exchange for a policy on any other, plan, exchanged it for a regular policy for a like amount, calling for an annual premium of $232, and providing that, in case of lapse for nonpayment of premium after payment of three annual premiums, the holder should be entitled to the benefits of the provisions relating to extended insurance. The insured paid two annual premiums under the second policy, and failed to pay further premiums. Held that, as the two policies were different, the second policy must be governed by Its terms, and the insured was not entitled to the benefits of the provisions relating to extended insurance, though he had paid one annual premium under the first policy.
    Appeal from Trial Term.
    Action by Patrick McGuire against the Union Mutual Life Insurance Company. From a judgment for plaintiff, defendant appeals.
    Reversed, and new trial granted.
    One Bateheller took from the defendant, March 8, 1898, a 10-year term policy for $5,000 on his life, payable to his wife, the annual premium of which was $134.60. The policy provided that, while it was in force, the insured could exchange it for a policy of like amount upon any plan then issued by the company, except a term policy, by paying the premium and rate called for thereby at the then age of the insured, without medical examination. March 6, 1899, the insured took a regular -life policy, for like amount, which called for an annual premium of $232, in place of the term policy, and paid only two premiums upon it March 15, 1901, the company received the note of the insured due July 15, 1901, for the third premium, which provided that, if it was not paid at maturity, the policy lapses for nonpayment. The note was not paid, and no other payments were made upon the policy. The insured died February 18, 1904, and the policy was assigned to the plaintiff. The policy provided that, “in case of lapse for nonpayment of premium after payment of three full years’ premiums in cash, this policy is entitled to the benefits of the Maine nonforfeiture law, securing the insurance from the date of this policy for the terms specified In the following table.” The table showed that, where three full premiums were paid, the policy remained in force for five years and 272 days from its date.
    Argued before SMITH, CHESTER, KELLOGG, and COCH-RANE, JJ.
    Howard B. Bayne, for appellant.
    Horton D. Wright, for respondent.
   JOHN M. KELLOGG, J.

The claim of respondent that the two policies constitute a continuing contract, so that the one premium paid under the term policy and the two premiums paid under the life policy make the three annual payments under the latter policy, and extend the insurance by virtue of the Maine nonforfeiture law, cannot be sustained. The policies are different. The rate of premium is different, and each was a separate contract in itself. The holder of the term policy, if he desired, by its terms was enabled to obtain other insurance in its place without a medical examination. The other insurance when taken must be governed by the terms of the policy taken. It is not necessary to consider whether the notice required by section- 92 of the Insurance Law (chapter 690, p. 1972, Laws 1892, as amended by chapter 218, p. 92, Laws 1897) was mailed or not, for this action was not brought within one year from the default day, as required by that section, and the note given for the premium expressly provided that the policy should lapse for nonpayment, if it was not paid at maturity.

The judgment should be reversed, and a new trial granted, with costs to the appellant to abide the event. All concur.