Green v. American Casualty Co.

[272]

Opinion

FLEMING, J.

Green brought suit against American Casualty Company to recover $50,000 in benefits under a group accidental-death and dismemberment insurance policy. The trial court concluded he was not covered by the policy at the time of his loss and entered judgment in favor of defendant. Green appeals.

Green was an employee of Farmer Brothers Company, which on 8 August 1962 contracted with American Casualty for a group policy providing accidental-death and dismemberment indemnity. Green joined the group and obtained coverage which included $50,000 for loss of a foot. Farmer Brothers paid in advance to American Casualty the $9 monthly premium on the 8th of each month, and then deducted $4.15 from Green’s paycheck every two weeks to cover the approximate cost of the premium. Green’s employment with Farmer Brothers terminated on 6 February 1967, when he disclosed to Farmer Brothers his embezzlement of its funds. On the evening of 8 February 1967 Green discharged a shotgun, as a result of which his left foot was amputated.

1. Green’s certificate of insurance from American Casualty provided:

“The individual coverage with respect to any Insured Person shall immediately terminate ... on the first premium due date following the date on which the Insured Person ceases to be an employee of the Policyholder. . . .”

The key issue is whether Green was covered by the policy on the evening of 8 February 1967. American Casualty argues that the policy’s coverage became effective at 12:01 a.m. on 8 August; that a monthly premium covered the period from the 8th of one month to the 7th of the following month; that 8 February was a premium due date; that since Green’s employment terminated prior to that date, his coverage ceased at 12:01 a.m. on 8 February 1967.

We do not accept this argument. Green’s certificate of insurance mentions the time “12:01 a.m.” only once and then says no more than “This insurance is effective on [8 August] at 12:01 a.m. . . .”

1

The termination clause in the certificate of insurance merely provides that coverage terminates “on the first premium due date following the date on which the Insured Person ceases to be an employee.” Because uncertainties in an in