§§ 834-835.

LIFE INSURANCE.

СПАР. 36

located, and the state or government under the laws of which it is organized." (Code, § 1749.)

The foregoing provisions are quoted from the statute concerning fire-insurance companies, but by section 1815 of the Code they are made applicable to life-insurance companies.

The statute requires every life-insurance company doing business in this state, including mutual assessment companies, fraternal and non-fraternal, to secure once each year a certificate from the auditor of state, showing it to be entitled to do business in this state until the next succeeding first day of April. (Code, §§ 1775, 1796, 1832.) Agents of such companies are also required to have certificates from the auditor before they are permitted to solicit insurance in this state. (Code, § 1800.) For soliciting insurance for a company which has no such certificate, or without having an agent's certificate, or for knowingly soliciting insurance for a company which is doing business in an unlawful manner, or which is insolvent, an agent incurs serious penalties and heavy liabilities. (Code, §§ 1801, 1814.)

Sec. 834. Frauds against life-insurance companies punished.— The statute provides that any agent, physician or other person who shall knowingly, by means of concealment of facts or false statements, procure or assist in procuring from any life-insurance organization any policy or certifi cate of insurance, shall be punished by fine and imprisonment; and obtaining money from a life-insurance company by falsely representing the insured to be dead, or attempting so to obtain money, or conspiring to do so, is a penitentiary offense. (Code, §§ 1816, 1817.)

Sec. 835. Unjust discriminations prohibited.

And to prevent an abuse, which certain companies have practiced in order to secure the membership of distinguished persons, to be used by way of advertisement, the general assembly has recently enacted the following:

"No life-insurance company or association shall make or permit any distinction or discrimination between persons insured of the same class and equal expectancy of life in the amount or payment of premiums or rates charged for policies of life or endowment insurance, or in the dividends or other benefits payable thereon, or in any other of the terms or conditions of the contracts it makes; nor shall any such company or association or agent thereof make any contract of insurance agreement, other than is plainly expressed in the policy issued; nor shall any such company or association or agent pay or allow directly or indirectly, as an inducement to insurance, any rebate of premium payable on the policy, or any special favor or advantage in the dividends or other benefits to accrue thereon, or any valuable consideration or inducement whatever, not specified in the policy or contract of insurance." (Code, § 1782; 27 G. A., ch. 46.)

"Every corporation, officer or agent thereof who shall knowingly violate any of the provisions of the preceding section shall forfeit and pay a sum not exceeding five hundred dollars, to be recovered by an action in the name of the state, for the benefit of the school fund, and the license may be revoked for three years, in the discretion of the court." (Code, § 1783.)

839. When the insurance begins.

840. Payment of premiums.

841-852. Conditions of recovery upon accident policies:

841. Accident must be direct cause of injury.

842. Disability must be total—what meant thereby.
843. Loss of hands, feet or eyes.

844. Change of occupation by the insured.

845. Injuries to travelers.

846. Effect of incurring unnecessary danger.

847. Want of due diligence on part of insured.

848. Quarreling and fighting by insured.

849. Injuries received while violating law.

850. Suicide or self-inflicted injuries.

851. Injuries during, or resulting from, intoxication.
852. Other miscellaneous conditions.

853. Notice to company of injury or death.

854. Company's right to examine body of insured.

855. Actions upon accident policies-time and place.

856. Evidence in actions upon accident policies.

857. Duty to submit to arbitration.

858. Who entitled to proceeds of policy.

859. Exemption of proceeds from liability for debt.
860. Companies must keep register of policies issued.

Accident insurance is an insurance against personal injury or loss of life through accident alone. It is a contract by which one party (usually an incorporated company), called the "insurer," agrees to pay to another party, called the "insured," a stipulated sum per week, for a stated number of weeks, during his disability caused by accident; or to pay to him a certain gross sum upon his loss, by accident, of one or both eyes, hands or feet; or to pay to some other person, called his "beneficiary," a certain other gross sum in case of the death of the insured by accident. It is a kind of insurance which is carried for the most part by traveling men, mechanics, railroad employes and others who are subjected to more than ordinary dangers from accidents, and by all classes of people, more or less, while upon a journey. The evidence of the contract given by the insurer to the insured is called the "policy," or, in case of insurance while on a journey, a "ticket," and the amount paid for the insurance is called the "premium."

The word "accident," as understood in accident insurance, has been variously defined as an injury which happens by reason of some violence, casuality or superior force to the assured, without his design or consent or voluntary cooperation;-as an unusual and unexpected result attending the performance of a usual and necessary act, or an unexpected event which happens as by chance, or which does not take place according to the usual course of things; --as an event which takes place without one's foresight or expectation;— which proceeds from an unknown cause, or is an unusual effect of a known cause, and therefore not expected.

§§ 837-838.

ACCIDENT INSURANCE.

CHAP. 37

The following cases illustrate the difference between what is accidental and what is not, and at the same time show how fine the distinction sometimes is: The death of the assured occurred by reason of the rupture of a blood-vessel, sustained while exercising with Indian clubs, and it was held that if he used the clubs for exercise in the ordinary way, and without the interference of any unusual circumstances, the injury was not accidental; but if there occurred any unforeseen accident or involuntary movement of the body, which, in connection with the use of the clubs, brought about the injury, then such means were accidental, and within the terms of the policy. In a very recent case in this state the death of one who held an accident policy resulted from the rupture of an artery as he reached to close a window. It did not appear that anything was done or occurred which he had not foreseen and planned, except the rupture, and it was held that his death was not the result of an accident. (107 Iowa, 538.) And in another recent case it is held that where there is insurance against death "from an accidental cause," and the insured dies from taking more morphine than he intended, the death is from an accidental cause, but not if he dies from taking just the amount of morphine he intended to take, not knowing that such an amount would cause death. (106 Iowa, 281.) Stepping off a train of cars and falling through a concealed hole in a bridge has been held to be an accident, but where the insured suffered a rupture by voluntarily jumping from a train before it had stopped, the injury was held not to be the result of an accident, but of his own voluntary act. Where the insured was seized with a fit and fell from the platform upon the railroad track in front of an approaching train, and was killed, it was held that the cause of death was the being run over and not the fit,—that is the death was caused by accident and not by disease. Where one is found dead in the water, and he might have come there either by drowning or suicide, the presumption will be in favor of accidental drowning rather than of intentional suicide. Sunstroke has been held to be a disease, and not an accident. Sec. 837. The application.

Inasmuch as the insurance is solely against injury or death by accident, and not by disease, there is not the same careful examination as to the health of the insured and that of his ancestors as in the case of life insurance, and the written application for the insurance, when there is any, is usually brief; but, so far as it goes in representations and promises, it is usually made a part of the policy, so that, if the representations are false or the promises violated, the policy may be declared void. As to this, the rule seems to be that, if the statements made in the application are made a part of the policy and warranted to be true, then there can be no recovery on the policy if any of them are false, no matter whether they are material to the risk or not; otherwise the falsity of such statements will not defeat a recovery unless they are shown to be material to the risk. The courts will construe all such contracts liberally in favor of the insured, and they will not suffer them to be forfeited on account of matters which are immaterial, unless, by upholding them, they would do violence to the language which the parties have seen fit to adopt in their contract. In the case of travelers' accident tickets there is no written application at all. The ticket itself contains all the terms of the contract.

Sec. 838. The policy.—

The policies issued by different accident-insurance companies are not all alike, and the same company sometimes offers a variety of policies to suit the desires of customers. The law allows the parties to make such contracts as they may see fit, and it will enforce them, as liberally interpreted in favor of the insured, so long as they are not in violation of well settled principles, or contrary to statute, or against public policy. But these policies all bristle with conditions upon which the company is not to be liable, and many of these conditions are substantially the same in all such policies, and some of the

СНАР. 37.

ACCIDENT INSURANCE.

$ 839

more important ones will be considered farther on. The holder of such a policy should familiarize himself with the conditions, so as not heedlessly to violate them and thus endanger his insurance. I give below the form of a trav eler's accident ticket (such as may be purchased at all important railway ticket offices), issued by one of the oldest and best known accident-insurance companies of this country. In such a ticket the day and hour when the insur ance begins is usually indicated by punch marks in the margin, and the number of days it has to run is otherwise indicated, as by coupons attached. The form given is a fair sample of all accident policies, and it is well worth reading.

FORM 106.

ACCIDENT INSURANCE TICKET

"The Travelers' Insurance Company, of Hartford, Conn., hereby insures (name of the insured), of (residence of the insured), for the term fixed by the coupons still attached hereto, against loss of time not exceeding 26 weeks, resulting from bodily injuries effected during the term of this insurance, through external, violent and accidental means, which shall, independently of all other causes, immediately and wholly disable him from transacting any and every kind of business; or, in event of death solely therefrom within ninety days, will pay the principal sum to his legal representatives. Except that this ticket insures females against death only; does not insure persons under sixteen or over seventy years old, employes on public conveyances while on duty, nor persons bereft of reason, sight or hearing; covers only injuries received within the civilized limits of the United States, Canada, Newfoundland, Mexico, West Indies, and Bermudas, including travel by regular passenger or mail lines on sea between such limits; that the company's total liability hereunder shall not exceed $3,000; that its limit of insurance under accident tickets is $6,000 with $30 weekly indemnity, and it will return on demand, to insured or his legal representatives, all premiums paid in excess thereof. With above exceptions this ticket grants $15 per week indemnity for disabling injuries, $3,000 principal sum; provided:

"(1) This insurance shall not cover disappearance; nor suicide, sane or insane; nor Injuries of which there is no visible mark on the body (the body itself in case of death not being deemed such mark); nor accident nor death nor disability resulting wholly or partly, directly or indirectly, from any of the following causes, or while so engaged or affected: Diseases or bodily infirmity, hernia, fits, vertigo, sleep-walking, medical or surgical treatment; intoxication or narcotics; voluntary or involuntary taking of poison or contact with poisonous substances or inhaling of any gas or vapor; sunstroke or freezing; dueling or fighting; war or riot; intentional injuries (inflicted by insured or any other person); voluntary overexertion; violating law; violating rules of a corporation; voluntary exposure to unnecessary danger; entering or trying to leave a moving conveyance using steam as a motive power (except cable cars), riding in or on any such conveyance not provided for transportation of passengers, walking or being on a railway bridge or road-bed.

"(2) Immediate written notice, with full particulars and full name and address of insured, is to be given said company at Hartford of any accident and injury for which claim is made. Unless affirmative proof of death or duration of disability, and of their being the proximate result of external, violent and accidental means, is so furnished within seven months from time of accident, all claims based thereon shall be forfeited to the company. No legal proceeding for recovery hereunder shall be brought within three months after receipt of proof at this office, nor at all unless begun one year from date of alleged accident.

"(3) Any medical adviser of the company shall be allowed, as often as he requires, to examine the person or body of insured in respect to alleged injury or cause of death." Sec. 839. When the insurance begins.

I have no doubt that accident-insurance companies may, and perhaps they sometimes do, authorize their agents to make binding contracts of insurance

§§ 840-841.

ACCIDENT INSURANCE.

CHAP. 37 to take effect immediately, so that, if the insured should be injured before receiving his policy, or at any time after the making of the contract, the company would be liable. But where the agent has no such authority, but is required to report the risk to his company for acceptance, the insurance does not begin until after the acceptance; and, though the company accepts the risk, but the insured is injured before such acceptance, he can recover nothing. (103 Iowa, 337.) Ordinary travelers' accident tickets are completed contracts as soon as issued, and they cover accidents happening within the time named therein without acceptance or approval by the company issuing them.

Sec. 840. Payment of premiums.—

The premium is the price paid for the insurance. In accident insurance the time covered, when considerable, is usually divided into periods, and an instaliment of premium is required to be paid for each period, and no recovery can be had for any injury received during a period for which the premium has not been paid. By the terms of the policy in such cases a failure to pay the premium works a forfeiture; but the company may waive the forfeiture, and it will be held to have done so when to permit a forfeiture would be inequitable. Usually the company will not be permitted to insist upon a forfeiture if by any agreement, either express, or to be implied from the course of its conduct, it induces the insured honestly to believe that the premiums will be received after the appointed day.

Companies insuring the employes of railways, and other such corporations, often take orders from the insured upon the company which employs him, for the payment of premiums as they fall due, the amount thereof to be deducted from his wages; and in such cases the rule is that, if the premium is not paid, the insurance company must notify the insured of that fact before insisting upon a forfeiture of the policy for non-payment. But in such a case, where the employe draws all his wages, and knows that the premium has not been paid, he is not entitled to notice from the company. (77 Iowa, 299.)

CONDITIONS OF RECOVERY UPON ACCIDENT POLICIES.

Sec. 841. The accident must be the direct cause of the injury.An accident-insurance company is liable for an injury or death only when an accident, as above defined, is the direct cause, and not the mere occasion, of the injury or death; or, in the usual language of the law, the accident must be the proximate, and not merely the remote, cause. This rule is easy enough to state, but by no means easy to apply to the facts as they arise. It may be illustrated thus: Suppose the assured receives an accidental blow upon the abdomen, and there results therefrom that sort of inflammation called peritonitis; loss of time or death caused by such sickness would be the direct result of the accident, for which the company would be liable; but if the blow and sickness resulting therefrom should wake up some disease already lurking in his system, the company would not be liable for loss of time or death resulting from such disease. It would be a remote cause.

If the injury or death is thus the direct result of the accident, the insurance company will be liable, even though some disease may contribute to the injury or death. (95 Iowa, 159.) It is usually sufficient to show that the injury or death would not have occurred but for the accident. And while such policies never cover injuries resulting from "disease" or "bodily infirmity," terms which mean practically the same thing, these terms only include ailnents or disorders of a somewhat established or settled character; and where the insured, through a mere temporary disorder arising from sudden and unexpected derangement of the system, falls and is injured by the fall, such injury may properly be regarded as accidental. (96 Iowa, 378.)