Opinion
November 17, 1943.
January 27, 1944.
Insurance — Application — Representations — False statements — Knowledge of insured — Fraud — Health of insured — Attendance at hospital — Evidence — Documentary.
1. Where a policy of life insurance provides that all statements made by the insured in his application shall, in the absence of fraud, be deemed representations and not warranties, the insurer, to avoid the policy, must show they were false and insured knew they were false or otherwise acted in bad faith in making them.
2. Where the insured states he is in good health and believes it to be so, though in fact he is suffering from some insidious disorder or latent disease of which he is not aware, a recovery on the policy may be had.
3. A question in a life insurance application as to whether or not the applicant has received or applied for treatment at, or attended any hospital, dispensary, sanitarium, or other institution, is fair and reasonable, and material to the risk.
4. A life insurance applicant is bound to have knowledge that less than nine months before he made application he was admitted to a hospital as a patient on two separate dates, and he is required to impart that knowledge to the insurer in his answer to a question relating to treatment or attendance at a hospital.
5. Where, in an action by the beneficiary on a policy of life insurance, the affidavit of defense set up, as new matter, a question in the application, the insured's denial as to treatment or attendance at a hospital and the facts showing that the insured's answer was false; and the plaintiff's reply was, in effect, an admission of the insured's attendance at a hospital on the dates specified in defendant's affidavit, with a denial that the insured knew he had diabetes when he made those visits; and the hospital records were admitted for the purpose of showing the insured's attendance at the hospital on the dates stated; it was Held that the uncontradicted documentary evidence established that the insured's answers to this question were false and fraudulent, and that judgment should be entered for defendant.
Before KELLER, P.J., BALDRIGE, STADTFELD, HIRT, KENWORTHEY and RENO, JJ. (RHODES, J., absent).
Appeal, No. 188, Oct. T. 1943, from judgment of M.C., Phila. Co., July T., 1942, No. 533, in case of Mary Harkins v. The John Hancock Mutual Life Insurance Company. Judgment reversed; reargument refused February 18, 1944.
Assumpsit. Before GLASS, J.
Verdict and judgment for plaintiff. Defendant appealed.
Charles M. Willits, with him Ira Jewell Williams, for appellant.
E. Herman Fuiman, for appellee.
Argued November 17, 1943.
This is an action of assumpsit on a policy of life insurance.
The insured was examined on June 24, 1941 by the company's physician, who recommended that the policy be issued; he was accepted as an insurable risk and the policy was issued as of date of July 1, 1941. He died on January 22, 1942 of diabetic acidosis and diabetes mellitus.
The company offered to refund the premiums paid, but disputed payment of the amount of insurance on two grounds: (1) False and fraudulent answers by the insured as to the condition of his health in his application for insurance; and (2) that he made a false and fraudulent answer to question No. 27 in said application, to wit, "Have you ever received or applied for treatment at, or attended, any hospital, dispensary, sanitarium, cure or other institution?" To which, he made answer, "No".
From a judgment on the verdict in favor of the plaintiff beneficiary for the face amount of the policy with interest, the defendant has appealed.
We think the insured's answers to questions Nos. 22, 29, 30 and 31 in the application, were not shown to have been false and fraudulent by documentary evidence or admissions in the pleadings within the ruling in Evans v. Penn Mutual Life Ins. Co., 322 Pa. 547, 555, 556-557, 186 A. 133, and hence were for the jury to consider and pass upon.
These questions and answers were:
"22. Are you now in sound health?"
Ans. "Yes".
"29. (a) Have albumin, blood or sugar ever been found in your urine?"
Ans. "No".
"(b) Have you ever been told that you had symptoms of Bright's disease or diabetes?"
Ans. "No".
"30. Have you ever had or consulted or been treated by a physician or other practitioner for any of the following: . . . . . . Kidney disease. . . . . ."
Ans. "No".
"31. Have you consulted or been treated by a physician or other practitioner during the past five years? Give full particulars".
Ans. "March 1941 — Cold in stomach. Fully recovered".
The insured's representation that he was in sound health, (No. 22), in connection with his examination by the company's physician, is directly within the ruling of the Supreme Court in Prudential Ins. Co. v. Kudoba, 323 Pa. 30, 186 A. 793, and the Act of July 19, 1935, P.L. 1319. See Schware v. Home Life Ins. Co., 134 Pa. Super. 53, 61, 62, 3 A.2d 949. His answer to that question, as well as the answers to Nos. 29 and 30, must be passed upon in the light of his knowledge of the matters inquired about. If he believed that his health was sound; if he had no knowledge that albumin, blood or sugar had been found in his urine; if he had never been told that he had symptoms of diabetes; if he had never knowingly consulted, or been treated by, a physician for kidney disease, his answers to those questions would not require a verdict for the defendant. It would be for the jury to find whether the answers were not only false but also, knowingly false, and therefore fraudulent: Evans v. Penn Mutual Life Ins. Co., supra, p. 554. "When the applicant states he is in good health and believes it to be so, though he is in fact suffering from some insidious disorder or latent disease, of which he is not aware, a recovery may be had": Evans v. Penn Mutual Life Ins. Co., supra, p. 554. His answer to No. 31, was not shown to have been false. If not as complete as desired, it could have been returned to him for a fuller explanation. The testimony of Dr. Rosato, the insured's physician, called as a witness by the defendant, while remarkable as an example of professional forgetfulness, absence of records and treatment without diagnosis, was for the jury, not the court, to pass upon.
The policy provided that all statements made by the insured in his application for insurance "shall, in the absence of fraud, be deemed representations and not warranties."
But question No. 27 of the application was in a different category. It called upon the applicant to answer whether he had ever received or applied for treatment at, or attended any hospital, dispensary, sanitarium, cure, or other institution. He did not have to know what was wrong with him that led to his going to or attending the hospital, etc. The records of the Episcopal Hospital, at Front and Lehigh Streets, show that the insured had been admitted to the clinic of the hospital as a patient on September 17, 1940 and September 25, 1940, less than nine months before he applied for this insurance. The question was a fair and reasonable one and the inquiry was material to the risk: Baxter v. N.Y. Life Ins. Co., 115 Pa. Super. 287, 293, 175 A. 899; Kasmer v. Metropolitan Life Ins. Co., 140 Pa. Super. 46, 51, 12 A.2d 805. The applicant was bound to have knowledge of an occurrence so shortly before and he was required to impart that knowledge to the company in his answer to the question: Glaser v. Metropolitan Life. Ins. Co., 139 Pa. Super. 261, 265, 11 A.2d 558; Soltaniuk v. Metropolitan Life Ins. Co., 133 Pa. Super. 139, 2 A.2d 501; Gimbel v. Aetna Life Ins. Co., 95 Pa. Super. 1, 4; Baxter v. N Y Life Ins. Co., 115 Pa. Super. 287, 175 A. 899; Anastasio v. Metropolitan Life Ins. Co., 149 Pa. Super. 414, 420, 421, 27 A.2d 510. While the hospital records were not shown to have been kept in such a manner as to permit them to be introduced in evidence for the purpose of showing that he was treated at the hospital for diabetes, they were properly admitted for the purpose of showing his attendance at the hospital clinic on those dates: Anastasio v. Metropolitan Life Ins. Co., supra, p. 420. Furthermore, the plaintiff's reply to the affidavit of defense setting up, as new matter, the insured's answer to question 27 and its falsity, was, in effect, an admission of his attendance at the hospital on those dates, with a denial that he knew he had diabetes when he made those visits. See p. 419 of the Anastasio case. The falsity of his answer did not rest on his having diabetes when he attended the hospital clinic or that he knew he had diabetes.
The facts are very similar to the Soltaniuk case, supra, and require the same action as was taken in that case.
The judgment is reversed, and judgment is now entered in favor of the plaintiff and against the defendant for $14.21, with interest from July 27, 1942.