Clark v. Mutual Life Ins. Co. of New York

This action was brought by appellant as beneficiary under a policy of life insurance issued by the Mutual Life Insurance Company of New York to appellant’s deceased husband, William D. Clark. The only question in the case is whether or not the balance of the insurance, after deducting the amount of the loan to the insured, should be paid in a lump sum or whether the beneficiary should be paid in annual installments during her life.

The policy was issued October 31, 1903, and provided for the payment of annual premiums for 20 years, the policy to become paid up upon the making of the 20 payments. At that time, according, to the terms of the policy, it had a cash surrender! value of $5,650 and a loan value of an equal amount. The insured took advantage of the loan feature of the policy, and on December 7, 1923, after having made his final payment thereon, borrowed the full cash surrender value of the policy. Apparently he paid the interest on this note until his death, which occurred on the 25th day of September, 1929. The insurance company, appellee herein, takes the position that its obligation under the policy was to pay to the beneficiary the sum of $158.60 annually for the…