Court Opinion

ID: 6550086
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:23:50.40659+00
Date Added: 2024-06-11T15:56:05.135933
License: Public Domain

Tom Glaze, Judge, concurring. I agree with the majority opinion, but I would add that the Social Security Act requires such a result. Under the insurance contract and facts of this case, appellee received $600 per month, i.e., 60% of his basic monthly compensation. This amount was to be reduced by the amount of any other income benefits, and other benefits were defined by the contract to include Social Security payments. At the time the policy issued to appellee went into existence, Social Security disability benefits were payable monthly. See 42 U.S.C. § 423. In Carner v. Farmers Insurance Company of Arkansas, 3 Ark. App. 201, 623 S.W. 2d 859 (1981), we adopted the following rule which I believe is applicable to the facts here: A statute applicable to a contract of insurance in force at the time of the making of the contract enters into and forms a part thereof, must be read in connection therewith in construing the terms of the policy, and controls in case of conflict. . . . The insurance contract before us provides for monthly compensation during appellee’s disability. This monthly compensation was to be reduced by Social Security benefits which by law are payable monthly as well. Of course, the appellee was paid a lump sum award of $3,622.30, but this award represented cumulative monthly payments. The trial court’s decision permitted appellant to recoup monies paid to appellee only for the month in which appellee received the accrued monthly Social Security payments. Of course, if we accepted the trial court’s construetion of the insurance contract, it not only may serve to reduce the amount of money an insurance company may recoup under the contract reduction provision, it could also render the reduction provision completely nugatory. For example, if appellee’s disability had ceased before the Social Security payments had been paid, the trial court’s interpretation of the insurance contract would mean that the appellant would receive no credit for any of the monthly compensation payments made to appellee. The point is that the trial court’s decision ignores the basis upon which disability benefits are paid under the insurance contract and the Social Security Act. Under each, compensation and benefits are paid on a monthly basis. It is only reasonable to conclude that any reduction or credit given in connection with those benefits should also be considered on a monthly basis. If we consider the provisions of the insurance contract and Social Security Act together, the conclusion is inescapable that coordination of monthly benefits was intended. The months appellee received benefits from appellant should have been correlated to those months appellee received Social Security payments. Each monthly compensation payment made under the insurance contract should have been reduced accordingly.