Bible v. John Hancock Mutual Life Insurance Co.

Anna Bible was a patient in a state psychiatric hospital due to manic depressive psychosis. An agent of the John Hancock Mutual Life Insurance Company (John Hancock) (defendant) visited her in the hospital and sold her two $400 life insurance policies payable on her death to her husband, Wacil Bible (plaintiff). The agent delivered Anna and Wacil the policy, and for three months thereafter, he collected the weekly premium until another agent began collecting the premium. About 20 months after the policies were purchased, Anna died. Wacil filed a claim with John Hancock that included the condition of her health at the time that the policies were purchased. John Hancock denied liability on the grounds that two health-related conditions had been breached. First, the policy was not to take effect unless upon the date of issuance the insured was alive and in sound health. Second, the policy was void if the insured was hospitalized or attended any “institution of any kind engaged in the care or cure of human health or disease, or has been attended by any physician, within two years before the date hereof, for any serious disease, complaint or operation,” unless such incidents were waived by endorsements appended to the plan. Further, waivers or alterations could not be authorized by agents and must have been in writing and signed by certain high-level employees. There was no such written waiver. Wacil sued. A jury found in Wacil’s favor, which the appellate court affirmed. John Hancock appealed again.