Court Opinion

ID: 3471363
Source: CourtListenerOpinion
Date Created: 2016-07-05 20:40:37.059631+00
Date Added: 2024-06-11T14:08:32.110220
License: Public Domain

I agree with the result reached by the author of the opinion and therefore concur in the decree. But I fear that the statement in the opinion to the effect that "by including a table of values showing reserve applicable to extended insurance, it substantially complied with Act No. 52 of 1906, as amended" may be construed as an expression of the view that the method adopted by the company in computing the reserve must be referred to in the policy.
I cannot concur in this view. I am convinced that the requirement of Act No. 227 of 1916 that "nothing shall be incorporated therein by reference to any constitution, by-laws, rules, application or other writings unless the same are endorsed upon or attached to the policy when issued" can have no reference to the amount of the reserve which, by Section 2 of Act No. 193
of 1906, must be established on certain policies. By the act of 1906 that reserve is required to be established whether or not there is contained in the policy any reference thereto, and, in the same statute which requires that the said reserve be established, it is provided that it shall be "computed according to the standard adopted by said company". It would seem to follow logically that, since the act requires that a reserve must be computed and held as a credit to the policyholder, the failure of the insurance company to refer, in the policy itself, to that reserve could not give to the company the right to point to the act of 1916 and to say that, since the reserve has not been referred to in the policy, that statute prevents the making of any claim based on the said reserve.
And since, in the same statute which requires the reserve, it is provided that the reserve shall be computed according to the standard adopted by the company, that standard need not be referred to in the policy. If, when a policy contains no reference to the standard or method which the company has adopted in computing the reserve, the company is, by Act No. 227 of 1916, prevented from proving that standard or method, then the policyholder cannot recover at all for the value of the reserve because there is not provided any method, by which the reserve may be computed, other than that adopted by the company. If proof of the company's standard is not admissible, then the extended term of the policy cannot be ascertained.
I concur in the decree.