A-10422, OCTOBER 24, 1925, 5 COMP. GEN. 286

A-10422: Oct 24, 1925

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WAR RISK INSURANCE - PREMIUMS WHERE AN ENLISTED MAN OF THE NAVY MADE APPLICATION FOR UNITED STATES GOVERNMENT CONVERTED INSURANCE IN DUE FORM WITHIN THE TIME ALLOWED BY THE CONTROLLING STATUTE DURING SERVICE AND THERE WAS DEDUCTED FROM HIS PAY THE CORRECT AMOUNT OF PREMIUMS PER MONTH PURSUANT TO A RECORD ALLOTMENT. INSURANCE PROTECTION MUST BE CONSIDERED AS HAVING BEEN GRANTED DURING THE PERIOD THE PREMIUMS WERE WITHHELD. NOTWITHSTANDING THE FACT THAT THE APPLICATION FOR INSURANCE AND AMOUNT OF PREMIUMS DEDUCTED WERE NOT IMMEDIATELY FORWARDED TO THE VETERANS' BUREAU AND THE POLICY WAS NOT ACTUALLY ISSUED UNTIL SUBSEQUENT TO WITHDRAWAL OF THE ALLOTMENT BY THE ENLISTED MAN. THE AMOUNT DEDUCTED FROM THE ENLISTED MAN'S PAY FOR THE PERIOD IN QUESTION IS PROPERLY PAYABLE TO THE VETERANS' BUREAU AS INSURANCE PREMIUMS.

A-10422, OCTOBER 24, 1925, 5 COMP. GEN. 286

WAR RISK INSURANCE - PREMIUMS WHERE AN ENLISTED MAN OF THE NAVY MADE APPLICATION FOR UNITED STATES GOVERNMENT CONVERTED INSURANCE IN DUE FORM WITHIN THE TIME ALLOWED BY THE CONTROLLING STATUTE DURING SERVICE AND THERE WAS DEDUCTED FROM HIS PAY THE CORRECT AMOUNT OF PREMIUMS PER MONTH PURSUANT TO A RECORD ALLOTMENT, INSURANCE PROTECTION MUST BE CONSIDERED AS HAVING BEEN GRANTED DURING THE PERIOD THE PREMIUMS WERE WITHHELD, NOTWITHSTANDING THE FACT THAT THE APPLICATION FOR INSURANCE AND AMOUNT OF PREMIUMS DEDUCTED WERE NOT IMMEDIATELY FORWARDED TO THE VETERANS' BUREAU AND THE POLICY WAS NOT ACTUALLY ISSUED UNTIL SUBSEQUENT TO WITHDRAWAL OF THE ALLOTMENT BY THE ENLISTED MAN. THE AMOUNT DEDUCTED FROM THE ENLISTED MAN'S PAY FOR THE PERIOD IN QUESTION IS PROPERLY PAYABLE TO THE VETERANS' BUREAU AS INSURANCE PREMIUMS.

COMPTROLLER GENERAL MCCARL TO THE DIRECTOR, UNITED STATES VETERANS' BUREAU, OCTOBER 24, 1925:

CONSIDERATION HAS BEEN GIVEN YOUR LETTER OF JUNE 15, 1925, IN THE MATTER OF SILAS MANN, FIREMAN, SECOND CLASS, UNITED STATES NAVY, SERIAL NO. 3361340, INSURANCE FILE NO. K-418335, REQUESTING DECISION AUTHORIZING CREDIT TO A. P. CARSON, INSURANCE CASHIER, UNITED STATES VETERANS' BUREAU, OF $91.52 DEDUCTED FROM THE PAY OF SILAS MANN FOR THE PERIOD APRIL, 1921, TO MAY, 1923.

THE FACTS ARE THAT MANN APPLIED FOR CONVERTED INSURANCE ON THE 20 PAYMENT LIFE PLAN IN THE AMOUNT OF $2,000 APRIL 1, 1921, WHILE STATIONED AT THE NAVAL TRAINING STATION, GREAT LAKES, ILL. THE INSURANCE APPLICATION AND ALLOTMENT EXECUTED BY MANN FOR DEDUCTION OF PREMIUMS FROM HIS PAY WERE NOT FORWARDED TO THE UNITED STATES VETERANS' BUREAU UNTIL SEPTEMBER 17, 1923, MORE THAN TWO YEARS LATER. MAY 26, 1923, MANN REQUESTED THAT HIS ALLOTMENT OF PAY FOR INSURANCE PREMIUMS BE DISCONTINUED, BUT NOTICE OF THIS REQUEST APPARENTLY WAS NOT GIVEN TO THE VETERANS' BUREAU. ACTING ON THE DELAYED INSURANCE APPLICATION RECEIVED SEPTEMBER 17, 1923, THE VETERANS' BUREAU ISSUED INSURANCE POLICY OCTOBER 11, 1923, AND FORWARDED SAME TO MANN. DECEMBER 6, 1923, THE NAVY SUPPLY OFFICER ADVISED THE VETERANS' BUREAU THAT THE ACCOUNT OF MANN HAD BEEN CREDITED WITH $91.52, THE AMOUNT OF THE PREMIUM CHECK AGE. THIS AMOUNT WAS REFUNDED TO THE ENLISTED MAN PURSUANT TO AUTHORIZATION OF THE NAVY DEPARTMENT DATED NOVEMBER 27, 1923.

THE NAVY DEPARTMENT HAS REFUSED TO RAISE A CHARGE AGAINST MANN AND COLLECT FROM HIM THE AMOUNT THUS REFUNDED FOR THE FOLLOWING STATED REASON APPEARING IN LETTER TO YOU DATED FEBRUARY 5, 1924:

IN VIEW OF THE FACT THAT ON 26 MAY 1923 MANN REQUESTED HIS ALLOTMENT FOR INSURANCE PREMIUMS STOPPED, AND THAT NO APPLICATION FOR INSURANCE HAD BEEN FILED IN THE VETERANS' BUREAU ON THAT DATE AND NO ALLOTMENT HAD BEEN RECORDED FOR PAYMENT IN THIS DEPARTMENT, THIS DEPARTMENT MUST DECLINE TO WITHHOLD FROM THE PAY DUE SILAS MANN THE SUM OF $91.52 AS REQUESTED BY YOU.

THE RECORDS OF THIS OFFICE SHOW THE FOLLOWING ALLOTMENT IN THE TRANSFER ACCOUNT OF SILAS MANN, DATED AUGUST 2, 1921:

FOR $3.52 PER MONTH FOR 47 MONTHS IN FAVOR OF TREAS. UNITED STATES B.W.R.I. REGISTERED BY J. E. ROBERTS AT U.S.N.T.S., GREAT LAKES, ILL. FIRST PAYMENT, APRIL, 1921. CHARGED BY OTHER OFFICES, $ NONE. CHARGED BY ME, $17.50; LAST MONTH, AUG., 1921.

THIS TRANSFER ACCOUNT WAS CERTIFIED AS CORRECT BY LIEUT. E. B. BROWN (JUNIOR GRADE), SUPPLY CORPS, UNITED STATES NAVY, FOR L. S. STEEVES, SUPPLY CORPS, UNITED STATES NAVY, AND ACCEPTED ON BOARD U.S.S. ST. LOUIS BY CAPT. WILLIAM D. LEAHY SEPTEMBER 13, 1921. A SIMILAR NOTATION APPEARS ON TRANSFER ACCOUNT DATED SEPTEMBER 30, 1921, APPARENTLY FROM ONE PAY OFFICER TO ANOTHER PAY OFFICER ON BOARD THE U.S.S. ST. LOUIS.

IN ORDER TO GRANT INSURANCE PROTECTION FOR ANY PERIOD UNDER THE PROVISIONS OF THE WAR-RISK INSURANCE ACT, IT IS ESSENTIAL THAT THERE BE RECORDED AN APPLICATION IN DUE FORM FOR THE INSURANCE AND THAT THE PREMIUMS ARE PAID WHEN DUE OR DURING THE GRACE PERIOD, PURSUANT TO AN AUTHORIZATION MADE BY THE INSURED. IN THIS CASE THERE WAS AN APPLICATION FOR THE INSURANCE AND AN ALLOTMENT OF PAY FOR THE PREMIUMS DULY EXECUTED BY THE INSURED AND RECORDED BY THE NAVAL OFFICERS AT THE NAVAL TRAINING STATION, PURSUANT TO WHICH THE MONTHLY PREMIUMS WERE DEDUCTED. THE ABSENCE OF RECORD IN THE NAVY DEPARTMENT, WASHINGTON, D.C., AT THE PRESENT TIME SHOWING ALLOTMENT OF PAY MAY NOT BE ACCEPTED AS CONCLUSIVE OF THE MATTER, FOR THE REASON THAT THE RECORDS IN THIS OFFICE CLEARLY SHOW BEYOND A REASONABLE DOUBT THAT THE ALLOTMENT WAS ACTUALLY MADE PURSUANT TO WHICH THE MONTHLY PREMIUMS WERE WITHHELD FROM THE PAY OF THE ENLISTED MAN.

THE QUESTION IS WHETHER THIS ACTION BY THE INSURED AND THE OFFICERS OF THE NAVY AT THE TRAINING STATION WAS SUFFICIENT TO HAVE OBLIGATED THE GOVERNMENT TO PAY THE AMOUNT OF INSURANCE FOR WHICH APPLICATION WAS MADE IN THE EVENT OF THE HAPPENING OF THE CONTINGENCY AGAINST WHICH INSURANCE WAS APPLIED FOR, AND TO OBLIGATE THE INSURED TO PAY THE PREMIUMS PRIOR TO ACTUAL RECEIPT OF THE APPLICATION FOR INSURANCE AND PREMIUMS IN THE VETERANS' BUREAU AND ISSUANCE OF THE POLICY.

THE ORIGINAL WAR-RISK INSURANCE ACT OF OCTOBER 6, 1917, 40 STAT. 409, PROVIDES FOR THE GRANTING OF INSURANCE TO ENLISTED MEN OF THE NAVY UPON APPLICATION TO THE BUREAU OF WAR RISK INSURANCE WITHIN 120 DAYS OF THE DATE OF ENLISTMENT OR FOR THOSE IN THE SERVICE AT THE TIME OF THE ACT WITHIN 120 DAYS OF THE PUBLICATION OF THE TERMS AND CONDITIONS OF THE CONTRACTS OF INSURANCE. PURSUANT TO THIS ACT AND UNDER ARRANGEMENTS WITH THE BUREAU OF WAR RISK INSURANCE, IT WAS THE PRACTICE FOR THE ARMY AND NAVY TO HAVE EACH MEMBER THEREOF EXECUTE AN APPLICATION FOR INSURANCE, SEEING TO IT THAT THE APPLICATIONS WERE MADE OUT IN PROPER FORM AND THAT THEY WERE TRANSMITTED TO THE BUREAU OF WAR RISK INSURANCE. THE REGULATIONS OF THE BUREAU OF WAR RISK INSURANCE PROVIDE THAT INSURANCE (CONVERTED) SHALL TAKE EFFECT ON THE FIRST OF THE MONTH FOLLOWING THAT IN WHICH APPLICATION IS MADE PROVIDED THAT PREMIUMS THEREFOR ARE PAID OR ALLOTTED FROM THE INSURED'S PAY. (SEC. 5011, VETERANS' BUREAU REGULATIONS, 1923.) SECTIONS 4021 TO 4123, VETERANS' BUREAU REGULATIONS, 1923, PROVIDE FOR THE GRANTING OF INSURANCE EVEN WHEN NO APPLICATION HAS BEEN RECEIVED IN THE BUREAU OF WAR RISK INSURANCE AND NONE CAN BE LOCATED, IF DEDUCTIONS OF INSURANCE PREMIUMS HAVE BEEN MADE IN THE ENLISTED MAN'S ACCOUNT. AN APPLICATION RECEIVED BY A DISBURSING OFFICER UPON WHICH THE FIRST PREMIUM HAD BEEN DEDUCTED WOULD HAVE BOUND THE UNITED STATES FROM A DATE PRIOR TO THAT ON WHICH IT WOULD HAVE REACHED THE BUREAU OF WAR RISK INSURANCE. THUS IT WILL BE SEEN THAT IT WAS NOT A MATTER OF ACCEPTANCE ON THE PART OF EITHER THE NAVY DEPARTMENT OR THE BUREAU OF WAR RISK INSURANCE, SO MUCH AS A MATTER OF RECORDED APPLICATION AND RECORDED PAYMENTS OF PREMIUMS IN THE MANNER PRESCRIBED BY REGULATION, THERE BEING NO QUESTION OF HEALTH INVOLVED FOR PERSONS IN THE ACTIVE NAVAL SERVICE.

IN ADDITION, IN THIS CASE THE VETERANS' BUREAU FINALLY ISSUED A POLICY, WITHOUT NOTICE OF ANY ADMINISTRATIVE IRREGULARITY, BASED ON THE ORIGINAL APPLICATION, WHICH WAS, IN EFFECT, AN ADJUDICATION THAT THE APPLICATION ORIGINALLY MADE WAS IN DUE FORM.

THE REASON FOR THE DELAY IN SENDING THE APPLICATION FOR INSURANCE TO THE VETERANS' BUREAU AND THE ACTION OF THE NAVY DEPARTMENT IN CREDITING CLAIMANT'S ACCOUNTS WITH THE AMOUNT OF THE PREMIUMS SUBSEQUENT TO THE DATE THE APPLICATION WAS FORWARDED TO THE VETERANS' BUREAU IS NOT DISCLOSED. THIS ADMINISTRATIVE IRREGULARITY, HOWEVER, DOES NOT AFFECT THE STATUS OF THE INSURANCE PROTECTION FROM THE DATE THE APPLICATION FOR THE NAVY INSURANCE WAS RECORDED AT THE NAVAL TRAINING STATION AND THE FIRST PREMIUM DEDUCTED FROM THE PAY OF THE ENLISTED MAN.

ACCORDINGLY, IT APPEARS THAT SILAS MANN WAS GIVEN INSURANCE PROTECTION DURING THE PERIOD APRIL, 1921, TO MAY, 1923. THE AMOUNT OF $91.52, REPRESENTING PREMIUMS DEDUCTED FROM THE PAY OF SILAS MANN OVER SUCH PERIOD, WILL BE TRANSFERRED FROM THE APPROPRIATIONS FOR THE PAY OF THE NAVY FOR THE FISCAL YEARS INVOLVED TO THE UNITED STATES GOVERNMENT LIFE INSURANCE FUND, AND A CHARGE FOR THE AMOUNT WILL BE CERTIFIED AGAINST SILAS MANN AND AGAINST THE DISBURSING OFFICER WHO CREDITED THE ACCOUNTS OF SILAS MANN WITH THE SUM OF $91.52 AS REFUND OF INSURANCE PREMIUMS AND THE USUAL COLLECTION PROCEEDINGS INSTITUTED.