New York Life Ins. v. Rutherford

GILBERT, Circuit Judge (after stating the facts as above). After the application was received by the agent, and the first premium was paid, nothing remained to be done by the insured to make the contract effective. There was no provision that the insured should be in good health at the time of the delivery of the policy. His state of health at that time was not mentioned in the policy or in the application. The only conditions were that the insurance applied for should not take ef *709 feet unless the first premium were paid and the policy delivered to, and received by, the insured during his lifetime. On the trial the insurance company exhibited the following rule for the guidance of its agents: “A policy must not be delivered under any circumstances if any change whatever has occurred in the health or occupation of the applicant since date of his medical examination. In such case the agent must at once return the policy to his branch office with full particulars and await further instructions.” This rule, however, had not been exhibited to the insured. It was not contained in the application or the policy, and the insured had no knowledge of it. It is the general rule that, until delivery of a policy, there is no contract of insurance, but there are exceptions to the rule. Thus delivery is unnecessary where the policy is held by the company or its agent in pursuance of an agreement that it be held until called for (Franklin Fire Ins. Co. v. Colt, 20 Wall. 560 , 22 L. Ed. 423 ), and the provision that the contract shall not be complete until delivered may be waived. In Unterharnscheidt v. Ins. Co., 160 Iowa, 223 , 138 N. W. 459 , 45 L. R. A. (N. S.) 743, it was held that, where an insurance company delivers a policy to its agent to be by him turned over to the insured, the premium having been paid when the application was accepted, the neglect of the agent to perform the manual act of placing the policy in the hands of the insured will not suspend the obligation of the company on its contract. Said the court: “If the premium is paid when the application is presented, and such application is approved and policy executed as of that date, and nothing remains but to deliver the paper to the insured, it may well be held that the sending of it to the agent to be by him given over to such insured person constitutes a sufficient delivery in law. * * * In other- words, delivery in law is not necessarily manual delivery.” In brief, the rule sustained by the weight of authority is that, even where the insurance contract requires delivery of the policy as a condition precedent to liability, the receiving of the policy by the agent for unconditional delivery will be taken as equivalent to delivery to the applicant if the contract has been otherwise consummated. 14 R. C. L. 899; Folds v. New York Life Ins. Co., 27 Ga. App. 435 , 108 S. E. 627 ; National Life Ass’n v. Speer, 111 Ark. 173 , 163 S. W. 1188 ; Missouri State Life Ins. Co. v. Burton, 129 Ark. 137 , 195 S. W. 371 ; Porter v. Mutual Life Ins. Co., 70 Vt. 504 , 41 Atl. 970 ; New York Life Ins. Co. v. Greenlee, 42 Ind. App. 82 , 84 N. E. 1101 . It is equally well established that the contract of insurance may not be qualified or limited by private instructions from the insurer to its agent. Fried v. Royal Ins. Co., 50 N. Y. 243 ; Going v. Ins. Co., 58 S. C. 201, 36 S. E. 556 . The plaintiff in error relies upon Bradley v. New York Life Ins. Co. (C. C. A.) 275 Fed. 657 , but that case is clearly distinguishable from the case at bar in that the insurance there under consideration was not to take effect unless the policy were delivered and received during the lifetime and good health of the insured. In that case the court found also that the first premium had not been paid. In the case at *710 bar the first premium was paid at the time when the application was signed, and there was no provision in the insurance contract that the insured should be in good health at the time of the delivery of the policy. • We find no error. The judgment is affirmed.