Where a life-insurance policy provides that, "The liability of the company shall be limited to the reserve on this policy, or to one-fifth of the amount payable hereunder on the death of the insured, whichever is the greater, if the insured should die while enrolled in military, naval, or air service in time of war, whether declared or undeclared; or if the insured should die as the direct or indirect result of such service, without securing a permit signed by an executive officer of the company, and paying such extra premium as the company may fix to cover the hazard," and where the insured entered the military service and canceled the double-indemnity clause of the policy on a form furnished by the company and showed on this form that he was engaged in the military service, and where the company acting under the information contained on this form, issued a new policy bearing the same date of the original and charged and collected a premium from the insured, this amounts to an implied waiver of the military clause of the policy, and the insurance company is estopped from pleading it. Harmon v. State Mutual Ins. Co., 202 Ga. 265 (42 S.E.2d 761).
DECIDED OCTOBER 1, 1947. *Page 733 Life and Casualty Insurance Company filed a bill of interpleader in the Superior Court of Fulton County, alleging among other things, that there are two or three possible claimants to the benefits of a certain policy issued on the life of Roy A. Swett, and that the company's liability under the terms of the policy is limited to $1000, instead of $5000, the face value of the policy, because of a war-risk clause. The bill prayed for a judgment to determine the proper party to whom payment should be made and to determine the amount of the liability. The facts of the case, as disclosed by the evidence which is supported by the pleadings of the parties, are substantially as follows: On May 15, 1942, in compliance with an application by Roy A. Swett, the Life and Casualty Insurance Company issued to him a policy in the amount of $5000 modified life with double indemnity. Copies of the policy and the double-indemnity clause were before the court. The quarterly premium under said policy was $16.60 which premium included the double-indemnity coverage under the policy.
On February 1, 1944, an application was filed with the insurance company requesting that the policy be changed from a modified life with double indemnity to a modified life without double indemnity, and that change was made and a new premium rate of $14.29 was set by the company. The insurance company issued this policy from an application which showed on its face that the insured entered the military service of the United States on September 23, 1943. With this knowledge the insurance company issued a new policy, but dated the new policy May 15, 1942, the date of the original policy.
The policy contained the following provision: "The liability of the company shall be limited to the reserve on this policy, or one-fifth of the amount payable thereunder on the death of the insured, whichever is the greater, if the insured should die while enrolled in military, naval, or air service, in time of war, whether declared or undeclared; or if the insured should die as a direct or indirect result of such service, without securing a permit signed by an executive officer of the company, and paying such extra premium as the company may fix to cover the hazard." The insured *Page 734 was killed in Italy while in the military service of the United States.
The contest between the various claimants was settled in the trial court and no appeal was taken from this finding.
On the trial of the case the judge of the Superior Court of Fulton County, directed a verdict for the plaintiff in error herein for $1000, this amount being one-fifth of the face value of the policy and being greater than the reserve on the policy, and the plaintiff in error assigns error thereon. The only question before this court is whether the beneficiary should recover the face value of the policy ($5000) or one-fifth of the face value of the policy ($1000), as awarded in the verdict. This issue rests on whether the insurance company had sufficient notice of the insured entering the military service of the United States to constitute a waiver on its part of the war-risk clause of the policy and an estoppel from asserting it as a defense to this action.
The facts as set out above disclose that the insurance company issued to the insured a policy with double-indemnity clause, in the amount of $5000, for which they received a premium of $16.60 and that the deceased carried this policy until shortly after he became a member of the Army of the United States. They also disclose that while in the Army of the United States he made application to the insurance company for a change from a modified life-insurance policy with double indemnity to such a policy without double indemnity, and that the application for this change showed that the insured was at this time in the military service of the United States.
The insurance company with this application before it issued a new policy of modified life insurance without double indemnity and dated the new policy the date of the original policy. The new policy was issued over the signature of the president and the secretary of the insurance company. This would indicate that the proper officers of the company had notice of the military service of the insured. *Page 735
This case is controlled by the ruling of the Supreme Court inHarmon v. State Mutual Life Insurance Co., 202 Ga. 265. In that case the Supreme Court by a unanimous decision ruled as follows: "Where a life-insurance policy provides for double indemnity in case of death by accident, for which an additional premium is charged, but further provides that the double-indemnity feature shall cease to be in force if the insured enters the military service, unless waived in writing by certain designated officers, and where the insured enters the military service and subsequently pays the premium, including the additional premium for double indemnity, which is accepted and retained by the company, when `some officer or agent having authority to issue policies or to enter the "waiver" had actual knowledge' of the insured entering the military service; this would amount to an implied waiver, and the right to recover would not be dependent upon a written waiver by the designated officers of the company."
The application for the new policy shows on its face that Swett was in the United States Army at the time the same was made. By the terms of the policy this application is a part of the contract of insurance. The construction of the contract, being in writing is a question of law for the court, and therefore, the plaintiff in error had knowledge of the insured being a member of the military forces of the United States. This fact is shown by the pleadings and by the undisputed evidence, both of which show the insurance policy in question including the application for the same. It accepted the premiums after the insured had requested that his policy be changed from a modified life with double indemnity to a modified life without double indemnity and went so far as to issue him a new policy bearing the date of the original policy. This policy was issued over the signature of the president and the secretary of the insurance company.
Under the ruling in the Harmon case, supra, this amounts to an implied waiver of the war-risk clause, and the insurance company is estopped from asserting it as a defense to this action.
The trial court erred in directing a verdict in favor of the beneficiary for one-fifth of the face value of the policy.
Judgment reversed. MacIntyre, P. J., and Gardner, J.,concur. *Page 736