Life Insurance Application

The life insurance application must be attached to the life insurance policy. Any experienced life insurance attorney in the Dallas and Fort Worth area can tell you this. It is emphasized in a Texas Supreme Court case in 1975, styled, Johnson v. Prudential Insurance Co. of America.
This is a lawsuit to collect benefits under a group life insurance policy. The insurance company resisted payment on the ground that the deceased insured willfully deceived the company by her statements made in procuring coverage; the company has obtained favorable findings to support this defense. This appealed followed.
Katherine Johnson was a teacher who obtained insurance upon her life under a group policy issued by the Prudential. She applied for insurance coverage on November 12, 1968. Prudential issued its certificate for her coverage, effective January 1, 1969. The amount of the original benefit was $10,000; it was raised to $12,000 in April of 1969 and then to $15,000 in 1970. Katherine Johnson died on November 16, 1970; her husband was the beneficiary on the insurance contract and brought this suit against the insurer on June 25, 1971.
Some ten years before applying for this insurance, Mrs. Johnson’s right breast had been removed because of cancer. From then until her death in 1970, though she continued her regular work as a schoolteacher, she suffered from the effects of cancer as well as from the rigors of its treatment and from periodic operations. In her original application, in her response to a letter of inquiry from Prudential dated November 27, 1968, and in her application for additional $3,000 benefit dated February 23, 1970, Mrs. Johnson made what she could have regarded as true statements, but they were incomplete and misleading. The issue is whether these statements could be used against Mrs. Johnson as grounds for Prudential to deny the claim for benefits.
Mrs. Johnson did not receive a copy of the policy with the application attached. This Court cited the relevant statute dealing with this law. Today the statute is Texas Insurance Code, Section 705.103. It requires that a copy of the application of the policyholder be attached to the policy. This requirement is in accord with long established legislative provisions which exist for well recognized reasons. Applications for insurance and other written statements made in that connection are often filled out or written by insurance agents or others and only signed by the insured. It has often been held that it is the underlying legislative intention to require that the insured have the material terms of the contract at hand during his lifetime in order that he might examine and correct any misrepresentations which have been made the basis of the insurance coverage.
Attachment of the application to the policy may be beneficial to the insurance company as well as to the insured, because the knowledge of the insured of the statements contained in the application is thereby conclusively established.