Premium

In Insurance. The consideration for a contract of insurance. A policy of insurance always expresses the consideration allied the premium, which is a certain amount or a certain rate upon the value at risk, paid wholly in cash, or partly so and partly by promissory note or otherwise.

2 Pars. Marit. Law 182.

By the charters of mutual fire insurance companies, the insured building is usually subject to a lien for the premium; Union Ins. Co. v. Hoge, 21 How. (U. S.) 35, 16 L. Ed. 61. The premium may be payable by service rendered; Kentucky Mut. Ins. Co. v. Jenks, 5 Ind. 96. In life insurance, the premium is usually payable periodically; Buckbee v. Trust Co., 18 Barb. (N. Y.) 541; and the continuance of the risk is usually made to depend upon the due payment of a periodical premium; Hallock v. Ins. Co., 26 N. J. L. 268. Illness is no excuse for not paying; Hipp v. Ins. Co., 128 Ga. 491, 57 S. E. 892, 12 L. R. A. (N. S.) 319. But if the practice of the company and its course of dealings with the insured, and others known to him, have been such as to induce a belief that so much of the contract as provides for a forfeiture upon non-payment at a fixed time will not be insisted on, the company will not be allowed to set up such a forfeiture, as against one in whom their conduct has induced such belief; May, Ins. § 361; Mut. Bl. Ins. Co. v. Higginbotham, 95 U. S. ' 380, 24 L. Ed. 499; Home estops a company from refusing/a premium after the death of the insured; Thompson v. Ins. Co., 116 Tenn. 557, 92 S. W. 1098, 6 L. R. A. (N. S.) 1039, 115 Am. St. Rep. 823. The acceptance by a manager of a life insurance company of a promissory note from the insured for the amount of the advance premium, and a delivery of the policy upon receipt of the note, constitute a waiver of the cash premium provided for in the application and policy which binds the company, although the policy also provides that the first premium shall be paid at the home office of the company on the delivery of the policy, and that no agent has power in any way to waive the terms of the contract; 18 N. Y. L. J. 1785. A company receiving and appropriating money paid by a policy holder cannot avoid liability on the policy on the ground that no receipt in the prescribed form was given; Matthews v. Ins. Co., 147 N. C. 339, 61 S. E. 192, 18 L. R. A. (N. S.) 1219. An action lies to recover a premium paid on a policy of life insurance where the company, upon the discovery of certain false statements inserted therein by the company’s agents, cancelled the policy, but the cost of the insurance enjoyed by the insured during the life of the policy must first be deducted; Mc Donald v. Ins. Co., 68 N. H. 4, 38 Atl. 500, 73 Am. St Rep. 548. But this is doubted in 46 Am. L. Reg. 40, because the insured should be entitled to recover the entire premium, he never having had any insurance under the void policy.

New York L. Ins. Oo. v. Fletcher, 117 U. S. 519, 6 Sup. Ct. 837, 29 L. Ed. 934.

So far as the agreed risk is not run in amount or time under a marine policy, the whole or a proportional stipulated or customary part of the premium is either not payable, or, if paid, is to be returned unless otherwise agreed; 2 Pars. Mart. Law 185; Hill v. Reed, 16 Barb. (N. Y.) 280; Mut Marine Ins. Co. v. Munro, 7 Gray (Mass.) 246. Where an insurance company authorizes the insured to seiu Da premium by mail, such premium is paid when the letter containing it is deposited in the post office addressed to the company; Mc Cluskey v. Life Ass’n, 77 Hun 556, 28 N. Y. Supp. 931.