OFFICE OF THE ATTORNEY ,GENERAL OF TEXAS 

AUS7lN 

Honorable. 0. P. Loakbart, Chrlrmn 

Ijoua or lMuranoe Co8u.m.1onar. 

Au8tln, Texa. 

Dmr Slrl oprnlon no. o-yxio 

Rer An l rirtioq @mUa ruor u.a In 

&drutrla;1 uul gvk3up’~llSo lniq .ap 8‘xogul~ly 8aheduled 

aLr rdvk Jsatueon daflnlte1.J 

UtablU4d alrporta: 1. void 

lIksof8.r m.8 it pfm 

the lnsuror'r Ii 

ort8tolmt 

11a llity after 

the axpllutlon of th. amte8tpuloa 8.t out In ~LrtlOl~8 

uid 4764b, Vernon’. Annot8td Civil Statute8. 

8eotloa 5 of Artlolo 4764b, Vernon’8 Annotated Civil 

Statutea, doallng rlth indu8trlal llfo Ln8uranao~ read8 In 

p.rt a. follov8: 
"Ro lnciustrlnl life lnsurnnca policy dollvored or 18sUed for dellVery 111 tba StSte 01 

Tex&8 @hall OOntain any prOvlsiOn Vhlnhl 

(I 

. . . . 

*(b) axeapt a8 OthUIIl88 provided herein, 

proVlde8 l-Or My mod8 Of 8ettlWOtlt at WtlWity 

OZ 1088 value th&n the WOUnts 1118~md on th8 

faoe of the polity, p1U. dividend 6ddltlOn. 

thereto, if &ny, le.8 My iCidebtedne.8 t0 the 

in.,Wer 011 the pO1lOy, aod 1.88 any prOtiU84 thrt . 

may, by the tormr of the policy, be bduotad, 

Uid prorlded al.0 th@t thi. F@OVi.iOlI -11 

not raved an addltlonal l ooldental death bowr1t L lng llmltrd 80 a8 IlOt to b. pay8ble in 

want of doath frw OWt8l.n aause8 Of 8OOldent8." 

There i8 a 8lnllar proVl8lon la htlo1e 4733, Vernon's 

Anaot8ted Civil Matutor, Vhlch read8 ln put 88 fO11OU8C 

"POliOie8 8hau UOt oont8ln Whati Tori81OtlS fOl' h-fit &88 Thn Ptil &IWJfit iX3 hX'- 

taln Cue8 Penltted. BO poli0y 0f iir0 iru~rmae 8hll be i88Wd or dellrerod ln thi8 Stata, 

or be 188wd by 8 life in8ur8noe oolpany hOOrpor8t.d UndU th. l8llO Of th18 St&e, If it OOCItaln8 any of the foll~vlng prool.lOn8: 

I 

. . . . 

"3. A &WOVi.iOLi for UJ mode Of 8OttltiOIlt 

8t meturltr of 1.~8 Vtiw thm the 8mOUnt8 in8ur.d On the f8Oe of the polloy, plus dividend 

l ddltlon., if My, 10s. w lIldebt.dIm.8 to the 

ooupuzy on the pollay, and le.8 any promlum ut 

nuy by the torma of the polloy bo deduotmd; provided, however, th8t any ~ooapn~ IUJ 188~ 8 

POliOy ~ollli.145 a benefit le.8 than tha fU11 

benefit ln oem of the death of the ln8ured by 

hI.8 own hand uhlls 8+a or lnranne, or by follouiq 8tAt.d haxudow OOOUp~tiOLl., or in the 

event the de8th of the lluured 8hould result 

from avl&tlon l otlvltle8 under the oonditlonr: 

*pelfled in the polloy, to be approved by the 
iitin~rt-tbl; 0. P. Lockhart, paw 3 

Board of lnswe.uc6 Com.mlsaion*rs, a8 provided in 

Chapter 3, Title 7d, of ths Revl8ed Clvll StatUt.8 Of 4.X438 Of 1925. This proVl81on ahell not 

apply to purely 8ooldtnt and health pollofe8. 

No forsgolng provl8lon retit- to polloy form6 

8h.11 apply t0 pO11Oi.8 188Utd ill l1.U Of, Oc 

in exohmge for, any other pO1101.8 188Wd before July 10, 1909. 

i 

AOt8 1909, 3l.t bag., p. 

1.92, 360. 23; Aot. 

264, t 1.)" 

19 1, 47th h&3., K.S., 8.8. 

Th. quot.d 8v1etiOn OtiU.6 l tt.mpt. to .X0.&% md 

txoldt from the oortrege of th. polloy the r1.k of de.th frm 

the 8ptOlfitd 08UI.8. It dot8 not eontbaplrte eg fi8blllty 

on the polloy .8 auoh, but, In efftot, provide. th8t the d.8th 

of' the ln8ur.d fl'0.i th. 0.U8.8 8.t OUt Win n6v.r Mt’W. the 

policy. It 18 not 8 01.U.t rt3O@iZi~ a lleblllty On the 

polloy end reducing under 8ptCifitd alroum8tmot8 the amount 

~rcml8.d to b. p8ld. For the.6 X'688on. it 18 not l 'prOv181on 

for any mods of l .ttl6ment et maturity of leea value thm th. 

amount. tneur.d on th. feoe of the p011ay~ 8Ed the 8bOve 

QU0t.d 8t8tUtOry ~rOVl.iOM er. not eppl.iC8bl6. &uht v. 

Ftdtrrl Llfo Inmuwnct Company, 248 3. V. 3251 Amwlae Uetlone1 Inaur~ot Capany v. Idweon, 127> 3. Y. (Bd) 

Great Southern Lift In.urenoe Cappanr v. Ulna, 105 %+4. 

(24) 902; Owrdl8n Idf. In8urenc6 Company T. tiloo8tlen, 

155 3. Y. (2d) 396. t%t l~lM8. Of CT.rt8iB O.... illdiO~tt8 

the oontruy vim. Athnt8 Ltoe lBllWMO6 Cm-y V. COPmltr, 85 9. W. (24) 1045; Cook Q. cOntlMnt81 C88wlty Conpe.ny, 160 3. Y. (Pd) 576; Unlvor8el Lift 1n8UF.nO. Co-y 

v. Grent, 117 S. Y. (26) 813. 

The Court In the 08100.tl.n 08.6, 8UJW8, Vhllt dleCuulng the oplnlon of th.lAV.~n CU., SUpF8, h.ld: 

. It 18 81.0 irpliOit in the ~lllion 

th8t .i& i...rtlon of non-lleblllty I. not prohlb1t.d by uid Art. 4 3, 8Ubd. 3. l'ha pmhlbltlon dtelerod by Art. P 733, l ubd. 3, ol.arly oonttRpl8tt. 8 lhbility Upon e policy 88 .UOh, urd 

the prohlb1t.d ~OV181OU 18 on. ooduolng th. 

eaount prcalotd to b. paid upon ooadition8 end 

With OUttin .XO.ptlOn.. In our oplnlon, it can 

h & r P. O l p p liO8tiOto B l pro Vl8lw rhloh Optr~tt8 

to l vtild th who16 promlst; provided, of OOUTI~, 

8uch prOVl8lOn 18 not 8UbjtCt t0 8OIt oth6r proNbltory rtetute." 
I.uncrebla 0. P. Lockhart, p&a 4 

The exoeptlon In subeectlon (b) of Aectlor~ 5 of 

Artlola (1764b uhleh l eeme to authorire l uah a olau~e In conne4ticm with 'an 8dditlonal death baefit" oarrim the UP 

plio8tlon t&t l uob olau8a 00108 vlthin the rtattimy prohibition dnoe, otharvls~, the exception vould be unneceeeary. 

hn lmplio8tlon, hovover, should not be ooxutrued 80 as to 

rary cr broulen tba l xpr888 laII@Aage Of the 8tatUte. 

Subuotlau (0) of kotion 2 of Artlclo 476kb, Voro~n*a Annoted cwil stmte0, rating t0 iddrutrm iire 

ir mur ~o e a nd l ubuotioa (1) of 8oetlon 1 of &tlolo 47648, 

V8rnOn'B Armotakd civil StatUtU, relatirrg t0 &rOUp iire 

i~ur811oe, both roqulre 8 polloy provl8lon 8tatlng IA 8ub8t8me 

that tha polloy 8U bo lnooatoatablo not later t&n tvo yo8r8 

fra It8 date. The 8titUt.8 LLUI OWt8lI.i eXOeptlI3SI8 t0 tbs 

lnoonto8t8b]lo reQulromnt but the quoted 8viatlO.U alWISe dom8 

not ftil V1tM.n 8UCh .xOeptlOM. 

tie 8UOh tnOOnte8trb& iVQkiirOUllt8 QQJLttibla t0 

8UOh 818USO? The Oa8.8 OOSl8trUing inOOntr8t~b& Ohi 8Z?O 

numerou8. In tha State of Ieu York (Betropollt~ Liio In8ll?8llOO c 

m.r. 4494 

V. convy, 3uperintwulent 0r ~.XUU~MO, n52 

m.8. 64~) and in other 8tater it i8 held that 

UI inoontortable O~NUO i8 no t & “IIM68tO l 8 to OOVW~e’ urd 

th a t l ur e p o llrOy & ILl U xaoptlng W l xoludlng fra tha 

rl8k U8U8d &ah rra 8~Olflul OaUU8 IS not oontru~ 

themto. It la rU8UMd that the l.nmlror’8 doruuo uncle 

8Wh l 018~80 18 ZIOt a OOntO8t Of ths pOllOr bUt Uh effort 

to udoroe It8 tera8. %18 reUOllb& 18 UUd in 8UU81 28X88 

ouea . 

(2d) 

r8XU R?U&ilti81 -UP-e c-7 1. liil*r, 80 9.Y. 

m2k sOUthVO8tUII Life h8WII.08 cCUIIDMy V. aOU@tCUi, 

Ul S.Y. I 2d) 61gb 

On the other hand it tn8 bowa hold th8t 8 eOate8table 018&U. l&UlIq O-trip UOaptlOllW 18 intWld.d t0 8llOU 

none not amod,,ud thku a l 1W80, no t l hhori~8d by th8 axoeptlons, but l ttoa#tlng to llalt oovarag8 md uolude rirk8 

18 oontruy to the inaonte8tabh r8qulromnt. *rnler v. 

P8OlflO YUtU81 uf0 XMLUMO~ ColpLlv, 173 hr. 1078, 88 

X&H. 76 . 

33 

For 8 oo~eotlon Of 8uthorltl88 8.8 the WOta- 

.tiOZl8 8t A.L.R. 394, 8nd 88 A.L.R. 773. 

The rO-8 8a8*8 sonatrulng a nd l log tin very 

alall8r ltmonta8t8bl8 rWJtireIWit Of title 732, V8rn0n'l 
flonorable il. f. Lockhart, p4xc 5 

¬ated Civil Statutes, u-e helpful in determlnl~ the l p - 

pllaablllty of the 8bOVe nrentloned prorl8lone to the aviation 

018U8e. The SU&WeM COUl’t Of 2’0x88, fIl AMrfOPn N8tfOnd Inl r8110e C~qmny v. Tabor, 230 3. U. 397, 8aldr 

*After the l xplratl0n of the period fixed, 

the 8UbdiViliOn WliUfMt~8 811 dden8cl8, OXOept 

tlloae mpeol8ll~ a8ntlonab." 

In barfern Ymtlowl Iauur8noe Company v. 

1063, the Ccrri8810~ of 49Oa18 nald; 

UO1.h. 22 3. If. (2dj 

Vh0 ra~iing md l rr00t or there prOVi8iOIA8 

VU8 t0 pe80?1be t.UO mlr8 l 8 tb lyli.EU@ p@ri0d Of lfMit8tiotl, aftOr Vhlah I10 dWfOM0, OXO@pt 

no-pant of preaiuw or vlolatlom or oon4ltlopl relative to naval or ullltu~ servloe duri0.g the VU, 8houldb l ibb3dt0 4.hatpapd 

Or 8 iu8 pOilOy.. . .’ 

In Atlanto We Iwursaoo Company v. CoCPIer, 85 

3. w. (la) lo45, tb8 Camri8810n 0r &Jp818 (opinion adopted 

by the Suprm Court) ha4 far oonsl4errtlon a ola~u provldlng 

thlt n0 b&h bWMrit ~88 pay8b& if duth ?88tdtWd ira 0 

dL8ea80 OOXktr&OtWd &Z’iOt t0 - dAt8 Or the POllOy, &hd that 

Qeeth Zror 8uoh aW18e Va8 not 8 risk -rumed. On OePtllled 

qllO8tlOM lnqalrlrl& vhetber , l.n vier 0r the incantestable requirement, the ln8urer could, 8.fter two year8, dete&koh that 

ground, the OOUPt 88id: 

" Life fll8IWUWO 8-88 %88uing 

pOxOii8’Oi uf0 inrtWUiO8 in thi8 8%,8 ~0 LWt 

idt rru te dOtOm rht u0eptioru thy rix.l 

vrite into thlor pOuO1.8. %8 8titUtO8 Duy 

the P Wr r ittl XOO d ~tiW, ud 8 5JrOV28100 d&iother l xoeptlonr 18 ~014. Any other oondruotlon of the l tatutoa uould thwart the evident 

ptWpO80 Of their WBUtMIIt. If the t¶X9eptlO3 

l ttO4ItWd t0 be h in thi8 -80 8hOkd4 be Upheld a8 valid, there would be no 1-t to the 

number of uoeptlonr that oo~ld be vrltten lnto a alloy or life IPmmaaoe, and, by mltlplyino tg-, an iluuranoe oompuly could vhittls 

doun the rf8k8 It 88eU808 UJ2til ft 8pO11OfeE 

would have but little, if any, re81 value. To 

prevent thl8 was the purpole far vhlch the Itatutem were enacted. 
"The queetlon certlfled la 8nsWered 'NO.'" 

The Cornusr 0680 has been questioned by JuQo Funderburk in tha Oalooetl4n oare, 8rlpra, in 80 fU ar It doe18 Vith 

Article 4733, but vc cannot agree thet it h88 been di8oredlted 

as to it8 lnterpret~tlon of the lncontestablo atiuSe of &tlcle 

4732 + A8 to the letter interpretation it ha8 been folloued in 

Ua8hlngton Platlooal Inauranoa CmLpany V. Clay, i% 3. u. (2d) 

834, Yhlah ca8c rch.wd, by virtue of &Section 3 of Artlole 

4732, to allow the insurer to Cafe&, after two yeer8, OKA a 

~18~80 thet cuurot be dlatlng;uLahed in prlnclple from the 

cl8ura now in question. 

A llre pollo~ provialon that the aontr8ot 8h8ll never 

beoom effeotlve unlere it 18 delivered vbl2e ineuro 18 tiiUa 

find in 8oun4 he8ltb la V81id. Qre8t PIetlonal Lit8 Iluuramce 

CO V. &~Lc, (corai88im Or Appeal8 hai8iOA) 1% 3. u. 

(23X2. But the lneurer may not rely upon 8uch olauee 88 l 

defame after the expiration of the two-year oonte8t8ble r1Od. Reuablr Ufc In8urraoe Coopeny v. Wyatt, 154 S.Y. r 26) 

24% ?ies4rve Loan ure Insurlace Capany v. Brown, 159 S.Y. 

(24 179. 

In our oplnlon the aVi8tiOA olau8e violate8 the, tinconte8table requirelaent8 of Artlola 4764r and 4764b, Vernon18 

Annot8tea Civil St8tUtW8, iololer 88 it purportr to provide a 

dsfenu 8fter the expir8tlon of the eonte8t~ble perlo therein wt out, and suoh cbu8s 8hotid not be 8pproved by the Board 

for that ronson. 

Us do not attempt to anover the broad que8tlon u to 

uhother Artiole8 4732 a nd k 733 l pply to industrial lire and 

group US4 pollcle8, but vu ~111, in thl8 oomeotlon, be glad 

to give our apinIon on any 44finlte f8Ot 8lturtlon sow berore 

your department. Iiowvor, ue oil1 to your 8ttentlOn the fol1OUlng pX’OV181Oll of hticle 476'Jbr 

"Sad. 7. A88OUiatiOA8 &ZCWptOd. ThL8 AOt 

8hd1 IlOt 8p& t0 10081 UUtLld ai4 888OOilbtiOM 

or etate-vlde mtrtu81 life, health, uul eeoldent 

OapMlW8 and burial ~88Oclation8 Operating under Senate Bill Ao. 135, Act8 of the Regulu S48- 

8iOn of the Forty-8lxt.h kgl818tuF8, but thi8 Act 

8nd ao other rhell apply to uxd govern the form 

8nd oontent 0r lndustrlal lir4 insuranae pollol48, 
Eonorabl8 0. P. lAwhut, p8go 7 

u they ua bf&md buda, lm8ud by al1 otbu 

la8ur~O txmpMl88.’ 

YOtu# ruy truly