A-2865, JULY 10, 1924, 4 COMP. GEN. 36

A-2865: Jul 10, 1924

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

VETERANS' BUREAU - INSURANCE PREMIUMS THE FACT THAT DEDUCTIONS WERE MADE FROM THE PAY OF AN ENLISTED MAN AS PREMIUMS ON WAR-RISK INSURANCE BUT WERE NOT PAID TO THE VETERANS' BUREAU FOR A PERIOD DURING WHICH NO ALLOTMENT OF THE ENLISTED MAN'S PAY FOR SUCH PREMIUMS WAS IN EFFECT DOES NOT ENTITLE THE VETERANS' BUREAU TO RECEIVE SUCH DEDUCTIONS COVERING THE PERIOD THE POLICY HAD TECHNICALLY LAPSED WHEN THE LIABILITY OF THE BUREAU TO MAKE PAYMENT ON THE POLICY HAS BEEN CANCELED BY THE DESERTION OF THE SOLDIER. WAS DISCHARGED SEPTEMBER 12. NOTWITHSTANDING THAT THERE WAS NO ALLOTMENT FOR THIS PERIOD. DEDUCTIONS OF INSURANCE PREMIUMS WERE MADE COVERING EACH MONTH THEREOF. WHICH WAS DISCONTINUED IN JANUARY.

A-2865, JULY 10, 1924, 4 COMP. GEN. 36

VETERANS' BUREAU - INSURANCE PREMIUMS THE FACT THAT DEDUCTIONS WERE MADE FROM THE PAY OF AN ENLISTED MAN AS PREMIUMS ON WAR-RISK INSURANCE BUT WERE NOT PAID TO THE VETERANS' BUREAU FOR A PERIOD DURING WHICH NO ALLOTMENT OF THE ENLISTED MAN'S PAY FOR SUCH PREMIUMS WAS IN EFFECT DOES NOT ENTITLE THE VETERANS' BUREAU TO RECEIVE SUCH DEDUCTIONS COVERING THE PERIOD THE POLICY HAD TECHNICALLY LAPSED WHEN THE LIABILITY OF THE BUREAU TO MAKE PAYMENT ON THE POLICY HAS BEEN CANCELED BY THE DESERTION OF THE SOLDIER.

DECISION BY COMPTROLLER GENERAL MCCARL, JULY 10, 1924:

THE UNITED STATES VETERANS' BUREAU HAS REQUESTED REVIEW OF SETTLEMENT M- 8819, DATED NOVEMBER 24, 1923, DISALLOWING ITS CLAIM FOR AMOUNT OF $29.25 DEDUCTED AS INSURANCE PREMIUMS FROM THE PAY OF GEORGE WALTER CARBERRY, SEAMAN, SECOND CLASS, UNITED STATES NAVY, FROM OCTOBER 21, 1921, TO JUNE 30, 1922.

GEORGE W. CARBERRY ENLISTED AUGUST 20, 1919, WAS DISCHARGED SEPTEMBER 12, 1921, REENLISTED SEPTEMBER 16, 1921, AND DESERTED JANUARY 7, 1923, AND THE RECORDS SHOW HIM TO BE A DESERTER AT LARGE.

HE EXECUTED AN ALLOTMENT AUTHORIZING DEDUCTION FOR INSURANCE PREMIUMS FROM HIS PAY EFFECTIVE FROM JANUARY 1, 1921, FOR A PERIOD OF NINE MONTHS, WHICH EXPIRED SEPTEMBER 30, 1921. HE DID NOT EXECUTE AN ALLOTMENT AUTHORIZING DEDUCTION OF PREMIUM PAYMENTS FROM HIS PAY COVERING THE PERIOD OCTOBER 1, 1921, TO JUNE 30, 1922. NOTWITHSTANDING THAT THERE WAS NO ALLOTMENT FOR THIS PERIOD, DEDUCTIONS OF INSURANCE PREMIUMS WERE MADE COVERING EACH MONTH THEREOF, THE TOTAL AMOUNT DEDUCTED BEING $29.25. EXECUTED AN INSURANCE ALLOTMENT EFFECTIVE FROM JULY 1, 1922, WHICH WAS DISCONTINUED IN JANUARY, 1923, WHEN HE DESERTED.

THE VETERANS' BUREAU CONTENDS AS FOLLOWS:

2. AS STATED IN THE BUREAU'S LETTER OF NOVEMBER 12, 1923, THIS MAN WAS FULLY PROTECTED FOR THE ABOVE PERIOD. THE PREMIUMS IN QUESTION WERE CHECKED WITHOUT PROTEST FROM THE INSURED, WHO EXPRESSED HIS DESIRE TO CONTINUE HIS INSURANCE BY REGISTERING ANOTHER ALLOTMENT, WHICH BEARS HIS WRITTEN SIGNATURE EFFECTIVE JULY 1, 1922. HAD THIS INSURANCE BECOME A CLAIM WHILE PREMIUMS WERE BEING CHECKED, PAYMENT OF THE PROCEEDS IN ACCORDANCE WITH THE CONTRACT WOULD NOT HAVE BEEN DENIED.

SECTION 400 OF THE WAR RISK INSURANCE ACT OF OCTOBER 6, 1917, 40 STAT. 409, PROVIDES FOR INSURANCE "UPON THE PAYMENT OF THE PREMIUMS AS HEREINAFTER PROVIDED.' SECTION 402 OF THE ACT PROVIDES THAT THE DIRECTOR OF THE BUREAU SHALL FIX THE TERMS AND CONDITIONS OF CONTRACTS OF INSURANCE. SECTION 404 PROVIDES THAT REGULATIONS SHALL PRESCRIBE THE TIME AND METHOD OF PAYMENTS OF THE PREMIUMS THEREON.

SECTION 4065 OF THE REGULATIONS OF THE UNITED STATES VETERANS' BUREAU, 1923, PROVIDES AS FOLLOWS:

WHEN AN INSURED PROVIDES FOR THE PAYMENT OF PREMIUMS BY AN ALLOTMENT OF HIS PAY, ANY PREVIOUS AUTHORIZATION FOR DEDUCTION FROM HIS PAY OR DEPOSIT FOR THE PAYMENT OF PREMIUMS SHALL BE DEEMED TO BE REVOKED AND HIS INSURANCE SHALL LAPSE AND TERMINATE AT THE END OF THE GRACE PERIOD AFTER THE ALLOTMENT OF HIS PAY EXPIRES, UNLESS THE INSURED REGISTERS A NEW ALLOTMENT OF HIS PAY OR EXECUTES AN AUTHORIZATION FOR DEDUCTIONS FROM HIS PAY OR DEPOSIT, OR OTHERWISE MAKES PAYMENT OF SAID PREMIUMS IN ORDER THAT EACH PREMIUM SHALL BE PAID UPON THE DATE IT IS DUE OR WITHIN THE GRACE PERIOD OF 31 DAYS, AS PROVIDED BY REGULATIONS AND THE TERMS OF THE UNITED STATES GOVERNMENT LIFE INSURANCE POLICY. (T.D. 48 W.R., SEPTEMBER 29, 1919, AS MODIFIED BY T.D. 66 W.R., JUNE 2, 1921, WHICH ALSO MODIFIES T.D. 49-A. THIS SUPERSEDES T.D. 44, WHICH SUPERSEDED PARTS OF T.D. 32 AND T.D. 33.)

THIS REGULATION WAS IN FORCE DURING THE PERIOD HERE IN QUESTION. ACCORDINGLY ON SEPTEMBER 30, 1921, THE AUTHORIZATION FOR ALLOTMENT OF PAY IN THIS CASE EXPIRED AND A NEW ONE WAS NOT IN EFFECT UNTIL JULY 1, 1922. THE UNAUTHORIZED DEDUCTIONS FROM THE PAY OF THE ENLISTED MAN AND THE EXECUTION OF A NEW ALLOTMENT COVERING A SUBSEQUENT PERIOD WERE NOT A COMPLIANCE WITH THE REGULATIONS DURING THE PERIOD HERE IN QUESTION. THERE WAS AT LEAST A TECHNICAL LAPSING OF THE POLICY UNDER THE REGULATIONS DURING THAT PERIOD. WHAT EFFECT THE EXECUTION OF THE NEW ALLOTMENT WOULD HAVE HAD ON THE QUESTION OF REINSTATEMENT NEED NOT NOW BE DECIDED IN VIEW OF THE DESERTION OF THE INSURED.

UNDER SECTION 29 OF THE WAR RISK INSURANCE ACT, AS AMENDED BY SECTION 1 OF THE ACT OF MARCH 4, 1923, 42 STAT. 1521, ALL RIGHTS UNDER WAR-RISK INSURANCE POLICIES ARE TERMINATED UPON DESERTION. 3 COMP. GEN. 465. LIKEWISE A DESERTER FORFEITS ALL PAY AND ALLOWANCES DUE HIM AT THE DATE OF DESERTION. IN VIEW OF THE FACT THAT THE VETERANS' BUREAU WOULD NOT, BASED ON THE PRESENT RECORD OF THE INSURED, EVER BE REQUIRED TO MAKE PAYMENTS UNDER THE POLICY OF INSURANCE GRANTED TO THIS ENLISTED MAN, AND THAT THE UNALLOTTED PAY OF THE DESERTER WAS FORFEITED, THERE IS NOT SUFFICIENT BASIS FOR THE CLAIM OF THE VETERANS' BUREAU.