Opinion
38983.
DECIDED JULY 14, 1961.
Action on insurance policy. Tattnall Superior Court. Before Judge Durrence.
Joe R. Young, Jr., Hitch, Miller Beckmann, for plaintiff in error.
B. Daniel Dubberly, Jr., L. P. Strickland, contra.
Where the facts pleaded affirmatively show that the insurance policy in question had expired on the date of loss, and where thereafter the insurance company, with knowledge of the facts, accepted and cashed a premium check and forwarded the insured a receipt stating, "You have been given credit for 12 days out of force between the policy due date and date of payment," thereby showing an intention not to reinstate the policy retroactively to the date of expiration, this did not amount to a waiver by the company of its right to insist on the defense of lack of coverage. Since from the facts pleaded in the petition it appears that such defense is good in law, it was error to overrule a general demurrer to the petition.
DECIDED JULY 14, 1961.
E. A. Moore brought an action in the Superior Court of Tattnall County against State Farm Mutual Automobile Insurance Co., seeking payments under a certain contract of automobile damage and medical payments insurance. The petition alleges generally that the policy was in full force and effect at the time of the collision which damaged the automobile and injured the plaintiff. Specific facts pleaded to support this allegation are that the insurance policy expired on July 16, 1959; that the collision occurred on July 24, 1959; that the 10-day grace period expired on July 26, 1959; that between 9 a. m. and 10 a. m. on July 28, 1959, plaintiff's wife talked with a named agent of the defendant in Metter, Georgia, and explained all the facts of the case to him and that the renewal premium check had not been mailed and said agent directed her to mail the check to defendant's Jacksonville office stating that he would inform the company of the situation. This was done. Defendant with full knowledge of the facts cashed the premium check and remitted a receipt containing the following language: "Notice: You have been given credit for 12 days out of force between the policy due date and date of payment, as shown above." The effect of this allocation of the premium payment check was to leave plaintiff's policy out of force on the day on which the collision occurred.
Demurrers to the petition were overruled, and error is assigned on this judgment.
Whether reinstatement of a lapsed insurance policy is prospective or retrospective is ordinarily determined by the policy terms. It was held in Winder Nat. Bank v. Aetna Life Ins. Co., 36 Ga. App. 703 (2) ( 137 S.E. 848) that where the intention of the parties is that the reinstatement shall relate back to the date of default the insured is covered during the interim period. In Plumer v. Continental Cas. Co., 12 Ga. App. 594 ( 77 S.E. 917), where there was a policy provision that reinstatement, if accepted, should be effective at noon of the day following the receipt of premium, it was held that since punctual payment of insurance premiums is of the essence of the contract, failure to make payment in strict compliance with contract terms results, in the absence of waiver by the insurer, in forfeiture. In Forrester v. State Farm Mut. Ins. Co., 97 Ga. App. 618 ( 103 S.E.2d 619), citing the Plumer case, this court held that where a policy of automobile insurance expires, and, after an injury has occurred during the default period, the insured mails a renewal premium which is cashed by the insurer but the insurer returns a rebate for the time the policy was out of force, which included the day on which the injury occurred, this did not constitute a waiver of the late payment of premium so as to relate the insurance coverage back to the time of expiration of the original policy.
In the present case the insurance company, with notice that the policy had expired and that the plaintiff had suffered a loss between the expiration date and the date he mailed a renewal premium check, granted the insurance prospectively from the date of receipt of the check. Nothing in the policy required the company to grant coverage at all, or, if it wished to do so, to relate the coverage back to the expiration of the original policy so as to cover the period during which the loss occurred. By its notice it specifically refused to do so. Nothing in the policy; or in the conduct of the parties indicates an intention that the reinstatement of the policy should be retroactive. Since the general allegation that the policy was in full force and effect on the date of loss must yield to the specific facts pleaded which show that such was not the case, the petition did not set forth a cause of action and the trial court erred in overruling the general demurrer.
Judgment reversed. Frankum and Jordan, JJ., concur.