Court Opinion

ID: 5766410
Source: CourtListenerOpinion
Date Created: 2022-01-12 17:23:43.044699+00
Date Added: 2024-06-11T08:41:39.756190
License: Public Domain

Marsh, J.
(dissenting.) The plaintiff asserts that the defendant insurance company in this action to recover the proceeds of a group life policy cannot use the defense of any material misrepresentation that deceased insured made in his health statement filed with his application for an investment plan with insurance because his health statement was not returned to him or his beneficiary as required by section 142 and paragraph (a) of subdivision 1 of section 161 of the Insurance Law. Section 142 would not appear to apply as the master group policy was issued to United Funds, Inc. and not to the insured. Paragraph (a) of subdivision 1 of section 161 does apply if United Funds, Inc., is not construed to be a beneficiary within the meaning of paragraph (a) of subdivision 1 of section 161, which it would appear it is not. However, it is not necessary to construe these statutes because contractual provisions of the policy itself are decisive of the issue without reading into the policy any statutory mandate.
The group life insurance policy between defendant John Hancock Mutual Life Ins. Co. and United Funds, Inc., provides: “ Entire Contract. This policy, the application of the Creditor, a copy of which is attached hereto and made a part hereof, the Life Insurance Information portion, only, of the application for the United Periodic Investment Plan with insurance of the Debtors, and the Insurer’s forms of Individual Statement with Health Certificate signed by the Debtor, and Statements to Medical Examiner in the application for insurance to the Insurer signed by the Debtor, if any, shall constitute the entire contract.”
*107The life insurance information portion of the deceased’s application form for the United Periodic Investment Plan with insurance contains the alleged misrepresentation which the insurer wishes to use as a defense to avoid payment of the proceeds of the policy. This insurance information portion of the application is signed by the deceased insured. The very last sentence of the insurance information portion prior to the signature of the deceased which is in brackets and italicized states: " A copy of this form will be returned to you upon acceptance of your Plan.” The insurance information portion of the application for the Periodic Investment Plan with insurance is made a part of the policy issued by John Hancock to United Funds, Inc., by the policy language quoted above. Thus John Hancock has agreed by incorporation of this health statement to return a copy of such health statement to the deceased insured. It is conceded by the insurer that it failed to do so.
The defendant insurer having failed to discharge its contractual obligation under the policy to return to the insured plan-holder a copy of the life insurance information portion of the application, upon its approval of the application, thus denying the applicant an opportunity to correct any misrepresentation in the application, it cannot now avail itself of any alleged misrepresentation in the application as a defense to plaintiff’s claims under the policy.
The statement in the information form itself evidences the insurer’s interpretation of paragraph (a) of subdivision 1 of section 161 as obligating it to deliver a copy of the health statement to the insured.
Because the policy provides for payment to United Funds, Inc. upon the death of an insured of all installments due the fund remaining unpaid at the insured’s date of death, the judgment should be modified so as to provide for the recovery of the amount of the judgment by defendant United Funds, Inc. of the defendant John Hancock Mutual Life Insurance Co. and the employment of the proceeds of such judgment by the defendant United Funds, Inc. in full discharge of the obligation of the estate of the decedent insured to defendant United Funds, Inc. for the unpaid balance of the plan.
Williams, P. J., and Henry, J., concur with Del Vecchio, J.; Marsh, J., dissents and votes to modify the judgment, and, as modified, affirm, in opinion in which Goldman, J., concurs.
Judgment and order reversed, on the law and facts, plaintiffs’ motion for summary judgment denied and summary judgment granted to defendant John Hancock Mutual Life Insurance Company, all without costs.