Fidelity Mutual Life Insurance v. Elmore

Cook, P. J. delivered the opinion of the court. This suit was instituted by appellee, administrator of the estate of Jas. A. Elmore, deceased, to recover on a policy of insurance issued by appellant upon the life of the deceased. There was a verdict for the plaintiff, and from the judgment rendered thereon the defendant prosecuted this appeal. The application for the policy was made on April 10', 1912; and on the next day appellant’s medical examiner examined the applicant. About' a month later the policy was delivered to and accepted by the applicant. Shortly after the delivery of the policy it was discovered that the assured was afflicted with tuberculosis, and it is probable that he was so afflicted at the time he made the application for the insurance, and when the policy was delivered to him. When this discovery was made the insurance company requested a surrender of the-policy, which was refused. The insured died June 23,1913, and upon the refusal of payment of the policy, this suit was brought. It was agreed that the insured was suffering with tuberculosis at the time his application was made and when the policy was delivered, and, subsequently, his death [142] was caused by the disease named. It is, however, insisted that the insured did not know of his condition when he made the application — that his statements as to his health were made in perfect good faith — and that he believed his. statements were absolutely true. The insurance company contends his representations, in the form they were made, were in effect warranties, and that if his statements were not true, the policy never had any legal effect and was void It is insisted, further, that the applicant’s being in good health at the time the policy was delivered was a condition precedent to the validity of the policy. The plaintiff relied on this clause in the policy itself as a complete answer to the defenses set up by the defendant, viz.: “All statements made by the insured shall, in the absence of fraud, be deemed representations and not warranties, and no such statement shall avoid or be used in defense to a claim under this policy, unless it is contained in a written application, and a copy of such application shall he indorsed upon or attached to the policy when issued.” First, as to the contention that the policy never had any validity, because it was admitted that the insured was not in good health at the time the policy was delivered, we think the statement in the application to this effect merely means that the defendant’s health had not undergone any change between the date of the application for and the delivery of the policy. In other words, if at the time the policy was delivered the insured’s health had changed, and the insured was aware of the fact, it would have been his bounden duty to have disclosed the fact; but if neither the insured nor the company knew of this changed condition of insured’s health when the policy was delivered, the “continued good health” clause in the application is saved by the terms of the policy itself, and the company will not be permitted to [143] contest the payment of the policy, unless it can show that the insured fraudulently concealed the fact that he was not in good health when he received the policy. The phrase “continued good health” can mean only that the insured having stated that he was in good health when he applied for the insurance, the company would not be hound to deliver the policy, if this state of good health had changed to a state of bad health, even though the application had been approved, the policy signed by the officers of the company and delivered to its agents for delivery to the insured. “Continued good health” is a relative term and manifestly relates to the insured’s statement of his condition when he signed the application. This is the letter of the document prepared by the insurance company, and its own carefully prepared documents will he construed most strongly against it. The phrase in question refers alone to the reserved right of the company to withhold delivery of the policy, and has no reference to the validity of the policy after its delivery to the insured. The only difference in the essential facts of this case and the facts of Life Ins. Co. v. Swords, 68 So. 920, is that in the present case the applicant said he was aware that his answers were “material to the risk.” . ' Learned counsel for appellant finds much more potency in “material to the risk” than we have been able to discover. In fact, we think this phrase has very little practical value. Any person of ordinary intelligence knows that his answers to questions propounded to him as a basis for life insurance are material, else they would not he asked. The applicant must have known that his answers were of material consequence, and he is hound to answer truthfully whether he is made to say that he knew his answers were “material to the risk” or not. This case is ruled by the Swords Case, 68 So. 920, and will he affirmed. Affirmed.