Perhaps no other public agency is the butt of as many jokes as the post office. But the mailing, and alleged late receipt of, a premium payment was no laughing matter for the petitioners in a Long Island based life insurance dispute. (See Fidelity Nat’l Title Ins. Co. v. Regent Abstract Serivces Ltd., N.Y. Cty. 110144/08, Dec. 15, 2008, Lehner, J.).
The policy had been taken out by a company on the life of one of its principles. When payment was not made by the January 27, 2008 due date, nor within the 31-day grace period thereafter, the insurer sent out a notice on February 28 advising that the policy had lapsed, but allowing reinstatement if payment was received by March 30 and so long as the insured was still alive when it was received.
The insured mailed the past-due payment on February 29, but it was not received until March 6. Meanwhile, the insured had died on March 3.
The New York County Supreme Court ruled in favor of the insurer that the policy was void. The court would have ruled the other way if the policy stated that payment had to be mailed, rather than received, before the death of the insured.
As Morrissey sang: “Such a little thing … but the difference it made was great.”
The warning to consumers is to be careful when dealing with life insurance companies for they will deny coverage on any and all feasible grounds.
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