Life Insurance Misrepresentation – Age

The Galveston Court of Appeals issued an opinion in 1938 that is still good law.  The case is styled, Texas State Life Insurance Company v. Freeman Barton.

This is an appeal from a trial to the Judge wherein Texas State was ordered to pay the life insurance proceeds to the beneficiary together with the statutory penalty and attorney fees.

The policy had been issued on Marie Clemons on July 10, 1935, with Barton as beneficiary and Marie having died on November 29, 1935.  (As a side note, this case points out “both of them being negroes,” – makes you wonder about that time in history).

There is only one relevant complaint in this case.  That is, that the trial court erred in holding the policy in effect when Marie died, first, because it had found that in her application for the insurance her age had been stated as 42, whereas at the time of her death she was more than 70 years of age, and, second, her application being made a part of the policy, it was the insured’s duty to see to it that her answers were properly recorded.

In the Court’s finding of fact, the court recited that the application for insurance neither was, nor ever had been, attached to the policy, that at the time the application had been made, the manager of Texas State personally saw and interviewed the insured; and further that the company, in issuing the policy, did not rely upon the stated representation of the insured that she was 42 years of age; finally, that as a matter of fact such misrepresentation as to her age was not material.

In this state of the record it is this court’s conclusion that no other judgment than the one rendered would have been a proper one; if the misrepresentation as to age was thus not a material one, and Texas State – so acting through its manager in personally interviewing the insured at the time of the application – did not rely upon any such misstatement of age as was in fact made, it follows that there was no such fraud practiced upon it in that respect as entitled Texas State to set the policy aside.

There are sections of the Texas Insurance Code that deal with a misstatement of age.  The current place is found in Section 1201.011 and Section 1201.220.  Essentially the same law was in place in 1938, but not argued to the court.

Furthermore, even if Texas State had been in position here to claim that a smaller amount than the face value of the policy should have been paid in this instance, because of such an understatement of age, the burden was upon it of proving what such difference in the amount was, and it wholly failed to meet that requirement – indeed, its brief admits that this record does not contain any testimony along that line.

The judgement in favor of Barton was affirmed.