The Indianapolis journal., 1899-12-18
ATTORNEY-GENERA TAYLOR SUB
MITS A LENGTHY OPINION.
Auditor of State Hart Was in Doubt
erning Assessment Companies.


suance OF certificates Of membership pro-
viding for the payment of benefits for dis
ability caused by sickness. and does the
act referred to govern and regulate the
business of life insurance or accident In
surance, or life and accident insurance of
the kind known as assessment insurance
as transacted by associations heretofore
organized under the laws OF this State and
associations of other States now doing
business within this State?" Attorney
General Taylor has prepared the following
opinion:
IL The rule of law is we'll settled that
a corporation created by statute can exer-
else no powers and has no rights except
such as are expressly given or necessarily
implied Huntington VS.. Savings Bank.
SO u. s., +. 393) The act referred TO in
your letter provides for the organization
of associations for the purpose of trans
acting the business OF life or accident, or
life and accident insurance, and for the
payment of partial or permanent disability
claims to living members upon the assess
ment plan for the purpose or mutual pro-
lection and relief TO it's members, and for
the payment of stipulated sums Of money
to the families, heirs, executors and ad-
ministratorS or assigns of the deceased
members, or for the payment of total and
permanent disability claims of living
society, as member may direct, in such
manner as may be provided in the by
laws
''It thus appears that the law provides
for: (a) Life insurance companies; (b) ac-
cident insurance companies; (c) life and
accident insurance companies.
THE AUTHORITY GIVEN.
''It nowhere appears that any authority
Is given to do any other kind Of business
than that contained in these three classes.
Life insurance is defined by Bouvier as
follows: The insurance on the life of a
person is a contract by which the insurer,
either in a gross sum or periodical pay
ments. undertakes to pay the person for
whose benefit the insurance is made a
stipulated sum or annuity equivalent,
upon the death of the person whose life is
insured. whenever this shall happen, if the
insurance be for the whole life, or in case
this shall happen within a certain period,
If the insurance be for limited time
substantially the same definition Is
given in Rapalje & Lawrence's Law Die
tionary. Therefore, it appears that, legal
ly, life insurance does not include any
thing more than insurance payable at the
termination of a life
Accident insurance is defined by Sec
ton 10 Of the act itself as insurance
against the contingency of death or phys
ical disability of the assured Hereunder
resulting from accidental injuries The
third class, being associations which do
life and accident insurance, has, of course,
no greater powers Of authority in either
class Of insui ance than any company or
ganized to do one kind Of business would
have in that class.
1T is evident, therefore, that the words
life or accident, or life and accident in
surance convey no greater powers than
those of writing insurance payable in the
hA nf fhn in,
of life insurance, or in the event of the
death or physical disability of the assured
caused by accident, in the case of acci-
dent insurance companies. Unless. there
fore, provision is made for health insur-
ance by some other language OF the statute
1t Is clear that II cannot be done under this
law. 1t is contended as to this that the act
provides. further. Tor the payment of par
tial or permanent disability claims to liv-
ing members II these words refer to ac-
cident insurance they can only refer to dis
abilities resulting from accident, because
sickness is not an accident. If they refer
to nfe insurance they probably carry with
them the right to insure against sickness.
1T is to be remembered that a corpora
tion created by statute can only exercise
the powers expressed or necessarily i'm
piled in the charter, and that where the
construction Is doubtful IL must be con-
strued against grant rather than in
favor of 1t.
LIFE INSURANCE. DEFINED.
life insurance as defined by the best
authorities is simply insurance against
death. Accident insurance defined by
this statute and as universally carried on
Is insurance not only against death but
against accidental disability. Sickness, it
is true, may produce permanent disability.
If. however, the disability resulting from
sickness had been contemplated by the
Legislature 1t is extremely probable that
the word temporary would have been
used rather than the word partial
partial disability is such disability as may
result from the loss of a member.
IL Wound seem, therefore, tnat the pay
ment or partial or Pc manent disability
claims to living members refers to partial
permanent disability produced by acci-
dent such as commonly accident companies
insure against. By the ordinary rules of
construction it must be held that these
words refer to accident insurance only.
1.-The statute further on provides for the
payment of total and permanent disability
claims to living members Total and
permanent disability claims are customar-
lily insured against only by accident COM
panies, and these words are to be con-
strued as referring to accident Insurance
only.
1T is clear that accident companies can
not do a sick benefit business. for II that
had been contemplated medical examina-
llOnS WOulu nave DteH Icpuhcu VI S"ch
companies. and this the statute expressly
relieves them from.
1.-THE statute is not entirely clear; but as
such statutes are to be construed as con-
veying no powers not clearly and expressly
given or necessarily implied, and as the su-
pervision exercised by the State Is for the
protection of the people, 1t is obviously the
duty of the officers of the State charged
with the enforcement of the law to take
nothing for granted, but to refuse TO recog-
niZe any authority in such corporations,
the exercise of which IS questionable. II Is,
my opinion that assessment COM
panies organized under the act of March
ness or in health insurance, to whichever
Of the three classes provided for In the act
such companies may belong.
80 Sec. 10 OF the act provides, as 10
foreign assessment insurance companies:
IF any such corporation, association or So
ciety is authorized by the law under which
Ii is incorporated TO issue contracts OF In
surance not contemplated in this act, it
shall, nevertheless, be permitted TO trans
act in this State the character or business
by this act upon complying in
all other respects with the requirements
thereof and filing with the auditor of state
an agreement duly executed by the proper
that such corporation, association
or society, will not enter into or issue with
in this State any contracts OF insurance.
policy or agreement not authorized by this
act. Upon a breach Of such agreement by
any such corporation. association or So
ciety the auditor OF state shall forthwith
revoke and cancel its authority to trans4ct
business in this State
FOREIGN ASSESSMENT COMPANIES.
at is my opinion that inasmuch as do
mestic companies. organized under the act
of 1897 referred to. are not permitted to en-