INCONTESTABLE CLAUSE

INDIANA NAT. LIFE INS. CO. v. McGINNIS.

Supreme Court of Indiana, 1913.
.180 Ind. 9, 101 N. E. 289, 45 L. R. A. (N. S.) 192.

Action by Melissa McGinnis against the Indiana National Life Insurance Company. From a judgment for plaintiff, the defendant appeals. * * * Affirmed.

SPENCER, J. This suit. was brought in June, 1909, to recover upon a life insurance contract issued on December 9, 1907, to John R. McGinnis of Gibson County, Indiana, and payable, $3,000 to appellee, the mother of the insured, and $2,000 to Emily S. McGinnis, the wife of the insured. John R. McGinnis died in Colorado on January 16. 1909.

The contract or policy in suit contained, among others, the following provisions: "Incontestability. After one year from date of issue this Policy shall be incontestable if the premiums have been duly paid." * * [The defendant's answer set up that before the expiration of the year the defendant discovered that the insured had been guilty of fraud and misrepresentation as to his state of health; that the defendant negotiated with him for a cancellation of the policy which had been delivered to the insured's mother and for a consideration of $140 paid to the insured he executed and delivered to the defendant a release.

The plaintiff replied a tender and refusal to accept a check for the premium on December 9, 1907.]

The most difficult questions here presented are resolvable into the following: (11 Does the incontestable clause preclude the company from asserting as a defense to its liability, the charge of false and fraudulent answers of the insured, the warranties in the contract. the mutual cancellation of the policy by the insurer and the insured without the knowledge of the beneficiary for a cash consideration paid by the company to the insured, where the answer asserting such defense is filed more than one year after the execution, delivery and acceptance of the contract? (2) Had the beneficiary, upon the execution, delivery and acceptance of this policy, such an interest therein, either vested, absolute. defeasible, indefeasible, qualified, limited or otherwise, that her interest can not be taken from her without her knowledge or consent by an agreement cancelling the policy, made between the insurer and the insured, to IA-hich she is not a party where the policy contains this clause as to the change of beneficiary: "The insured may at any time during the continuance of this policy, provided the policy is not then assigned, and subject to the rules of this company regarding agreements and beneficiaries, change the beneficiary or beneficiaries by written notice to the company, at its Head Office; such