JULY 18, 1923, 3 COMP. GEN. 29

JULY 18, 1923, 3 COMP. GEN. 29

LAPSING OF WAR RISK INSURANCE POLICIES UPON THE DEATH FROM DISEASE OF SERVICE ORIGIN OF THE INSURED UNDER A WAR RISK INSURANCE POLICY, THERE BEING DUE AND UNPAID DISABILITY COMPENSATION SUFFICIENT TO MEET ANY UNPAID PREMIUMS ON HIS POLICY, THE LAPSING OF THE POLICY FOR UNPAID PREMIUMS IS PREVENTED BY THE ACT OF MARCH 4, 1923, 42 STAT., 1525, IT BEING IMMATERIAL WHETHER THE DISABILITY OR DISEASE UPON WHICH THE COMPENSATION AWARD WAS BASED WAS THE SAME OR A DIFFERENT DISABILITY OR DISEASE THAN THAT RESULTING IN THE INSURED'S DEATH.

ACTING COMPTROLLER GENERAL GINN TO THE DIRECTOR UNITED STATES VETERANS' BUREAU, JULY 18, 1923:

YOUR LETTER OF APRIL 11, 1923, WAS RECEIVED, REQUESTING REVIEW OF SETTLEMENT W-885235, THIS OFFICE, DATED FEBRUARY 14, 1923, DISALLOWING THE CLAIM OF MARY LOU VICY MAZY FOR $1,747.26, ACCRUED INSURANCE INSTALLMENTS UNDER POLICY ON THE LIFE OF HER SON, JAMES WITE MAZY, FORMER PRIVATE, UNITED STATES ARMY, WHO DIED MAY 11, 1920.

THE FACTS ARE STATED BY YOU AS FOLLOWS:

A RESUME OF THE INVESTIGATION AND FINDINGS OF THE BUREAU IN CONNECTION WITH THIS CASE SHOWS THAT JAMES WITE MAZY ENTERED MILITARY SERVICE AUGUST 8, 1918; THAT ON AUGUST 12, 1918, HE MADE APPLICATION FOR INSURANCE IN THE SUM OF $10,000 UNDER THE WAR RISK INSURANCE ACT AND NAMED HIS MOTHER AS BENEFICIARY; THAT THE MONTHLY PREMIUM ON HIS INSURANCE WAS DEDUCTED FROM HIS PAY WHILE IN THE SERVICE, THE LAST MONTH FOR WHICH DEDUCTION WAS MADE BEING JUNE, 1919, AND THE AMOUNT OF PREMIUM DEDUCTED BEING $6.90; THAT HE WAS DISCHARGED FROM THE SERVICE JULY 21, 1919, AND FILED CLAIM FOR COMPENSATION MARCH 8, 1920, IN WHICH HE ALLEGED HIS DISABILITY AS "NEURITIS--- ULCER OF HEEL; " THAT IN APRIL, 1920, HE WAS ADJUDGED INSANE BY THE COUNTY COURT OF LAMAR COUNTY, TEXAS; AND THAT ON MAY 11, 1920, HE DIED WITHOUT HAVING BEEN AWARDED OR PAID COMPENSATION. THE RECORDS OF THE BUREAU FURTHER SHOW THAT ON NOVEMBER 22, 1920, THE MEDICAL BOARD OF REVIEW RATED THE FORMER SOLDIER AS PERMANENTLY AND TOTALLY DISABLED FROM JANUARY 20, 1920, TO THE DATE OF HIS DEATH, BUT FAILED TO FIND THAT HIS DISABILITY WAS INCIDENT TO SERVICE. HOWEVER, ON FEBRUARY 25, 1922 (WHICH WAS SUBSEQUENT TO THE TIME THE PRESUMPTION OF SERVICE CONNECTION IN NEUROPSYCHIATRIC DISEASES WAS INCORPORATED IN THE WAR RISK INSURANCE ACT BY THE AMENDMENT TO SECTION 300, WHICH WAS CONTAINED IN THE ACT APPROVED AUGUST 9, 1921),THE MEDICAL BOARD OF REVIEW RATED THE CASE AS FOLLOWS:

"TEMPORARY PARTIAL 20 PERCENT (TWENTY PERCENT) FROM DATE OF SEPARATION FROM ACTIVE SERVICE TO DATE OF DEATH. ULCER OF HEEL. SERVICE ORIGIN. NOT A CONCURRENT OR CONTRIBUTORY CAUSE OF DEATH.

"PERMANENT TOTAL UNDER REG. 4, B, IV, (B) FROM JANUARY 20, 1920, TO DATE OF DEATH. DEMENTIA PRAECOX. SERVICE ORIGIN UNDER SECTION 18, PUBLIC 47, 67TH CONGRESS.'

THIS RATING WAS APPROVED BY THE BOARD OF APPEALS FEBRUARY 28, 1922.

THE INSURED HAVING FAILED TO PAY PREMIUMS SUBSEQUENT TO HIS DISCHARGE THE QUESTION ARISES WHETHER THE POLICY LAPSED, THEREBY DEFEATING PAYMENT TO THE DEATH BENEFICIARY, OR WHETHER HIS RIGHT TO DISABILITY COMPENSATION DURING THE PERIOD FROM DISCHARGE TO DEATH PREVENTED THE LAPSATION AND VALIDATED THE POLICY UNDER SECTION 408 OF THE WAR RISK ACT.

SECTION 408 OF THE WAR RISK ACT AS AMENDED, ACT MARCH 4, 1923, 42 STAT., 1525, PROVIDES IN PART AS FOLLOWS:

* * * THAT WHERE ANY SOLDIER HAS HERETOFORE ALLOWED HIS INSURANCE TO LAPSE, WHILE SUFFERING FROM WOUNDS OR DISEASE SUFFERED OR CONTRACTED IN LINE OF SERVICE, AND WAS AT THE TIME HE ALLOWED HIS INSURANCE TO LAPSE ENTITLED TO COMPENSATION ON ACCOUNT THEREOF IN A SUM EQUAL TO OR IN EXCESS OF THE AMOUNT DUE FROM HIM IN PREMIUMS ON HIS SAID INSURANCE, AND DIES OR HAS DIED FROM SAID WOUNDS OR DISEASE, OR BECOMES OR HAS BECOME PERMANENTLY AND TOTALLY DISABLED BY REASON THEREOF, WITHOUT COLLECTING SAID COMPENSATION, AND AT THE TIME OF SUCH DEATH OR PERMANENT TOTAL DISABILITY HAD OR HAS SUFFICIENT UNCOLLECTED COMPENSATION TO PAY ALL UNPAID PREMIUMS, THEN AND IN THAT EVENT SAID POLICY SHALL NOT BE CONSIDERED AS LAPSED, AND THE UNITED STATES VETERANS' BUREAU IS HEREBY AUTHORIZED AND DIRECTED TO PAY TO THE SAID SOLDIER OR HIS BENEFICIARIES UNDER SAID POLICY THE AMOUNT OF SAID INSURANCE LESS THE PREMIUMS AND INTEREST THEREON AT 5 PERCENTUM PER ANNUM COMPOUNDED ANNUALLY IN INSTALLMENTS AS PROVIDED BY LAW: * * *

ALL OF THE CONDITIONS FIXED BY THE STATUTE TO PREVENT LAPSATION ARE PRESENT IN THIS CASE WITH THE EXCEPTION THAT THE INSURED DID NOT DIE FROM THE WOUNDS OR DISEASE UPON WHICH ACCRUED DISABILITY COMPENSATION, BUT FROM A DISEASE THERETO TOTALLY UNRELATED, DEMENTIA PRAECOX. THE SERVICE ORIGIN OF THE DISEASE WHICH CAUSED DEATH IS PRESUMED UNDER PROVISION OF SECTION 300 OF THE WAR RISK ACT AS AMENDED, ACT OF MARCH 4, 1923, THE EXAMINATION OF THE MEDICAL OFFICERS OF THE VETERANS' BUREAU HAVING BEEN MADE WITHIN THREE YEARS AFTER DISCHARGE OF THE SOLDIER FROM THE SERVICE.

THE ONE OBJECT SOUGHT BY CONGRESS BY THE ENACTMENT OF THE QUOTED PROVISION OF SECTION 408 OF THE WAR RISK ACT WAS TO PREVENT THE LAPSATION OF INSURANCE POLICIES OF DISABLED VETERANS WHO WERE ENTITLED TO COMPENSATION BECAUSE OF THEIR DISABILITIES, THE THEORY BEING, OF COURSE, THAT THE GOVERNMENT HAD IN ITS POSSESSION SUFFICIENT FUNDS LEGALLY BELONGING TO THE VETERANS TO KEEP ALIVE THE POLICIES. THERE APPEARS NO SOUND REASON FOR THE CONDITION THAT DEATH MUST HAVE RESULTED FROM THE DISABILITY FOR WHICH COMPENSATION ACCRUED DURING THE PERIOD THE POLICY WOULD OTHERWISE HAVE LAPSED. THE WORDS "DIES OR HAS DIED FROM SAID WOUNDS OR DISEASE" MAY BE HELD TO PROPERLY RELATE TO THE GENERAL PRECEDING PHRASE "WOUNDS OR DISEASE SUFFERED OR CONTRACTED IN LINE OF SERVICE," AND NOT NECESSARILY LIMITED TO THE SPECIFIC WOUND OR DISEASE FOR WHICH COMPENSATION HAS ACCRUED AT THE TIME OF LAPSE; THAT IS, IF THE DISEASE IS OF SERVICE ORIGIN THE CONDITIONS OF THE STATUTE HAVE BEEN MET.

IN THE PRESENT CASE, THEREFORE, IT MAY BE HELD THAT ALL THE CONDITIONS OF SECTION 408 OF THE WAR RISK ACT HAVE BEEN MET AND THAT THE POLICY OF INSURANCE DID NOT LAPSE.

UPON REVIEW OF THE MATTER THE SETTLEMENT IS REVERSED AND THE SUM OF $1,747.26 IS CERTIFIED DUE CLAIMANT.