CACI No. 2302. Breach of Contract for Temporary Life Insurance - Essential Factual Elements

Judicial Council of California Civil Jury Instructions (2023 edition)

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2302.Breach of Contract for Temporary Life Insurance - Essential
Factual Elements
[Name of plaintiff] claims that [name of defendant] breached an agreement
to pay life insurance benefits. To establish this claim, [name of plaintiff]
must prove all of the following:
1. That [name of defendant] or its authorized agent received [name of
decedent]’s application for life insurance;
2. That [name of decedent] paid the first insurance premium;
3. That [name of decedent] died [on/after/before] [insert relevant
date]; and
4. The amount of the insurance benefits that [name of defendant]
failed to pay.
New September 2003
Directions for Use
The instructions in this series assume the plaintiff is the insured and the defendant is
the insurer. The party designations may be changed if appropriate to the facts of the
This instruction is intended for an alleged breach of a contract of temporary life
insurance coverage. The court must interpret as a matter of law whether an ordinary
person in the applicant’s circumstances would conclude, based on the language of
the application, that coverage began immediately. Do not use this instruction unless
the court has decided this issue.
Sources and Authority
Death of Insured Before Issuance of Policy. Insurance Code section 10115.
“We are of the view that a contract of insurance arose upon defendant’s receipt
of the completed application and the first premium payment. . . . The
understanding of an ordinary person is the standard [that] must be used in
construing the contract, and such a person upon reading the application would
believe that he would secure the benefit of immediate coverage by paying the
premium in advance of delivery of the policy.” (Ransom v. The Penn Mutual Life
Insurance Co. (1954) 43 Cal.2d 420, 425 [274 P.2d 633].)
“[A]n insurance company is not precluded from imposing conditions precedent
to the effectiveness of insurance coverage despite the advance payment of the
first premium. However, . . . any such condition must be stated in conspicuous,
unambiguous and unequivocal language which an ordinary layman can
understand.” (Thompson v. Occidental Life Insurance Co. of California (1973) 9
Cal.3d 904, 912 [109 Cal.Rptr. 473, 513 P.2d 353].)
Temporary life insurance coverage “is not terminated until the applicant receives
from the insurer both a notice of the rejection of his application and a refund of
his premium.” (Smith v. Westland Life Insurance Co. (1975) 15 Cal.3d 111, 120
[123 Cal.Rptr. 649, 539 P.2d 433].)
“Under California law, a contract of temporary insurance may arise from
completion of an application for insurance and payment of the first premium if
the language of the application would lead an ordinary lay person to conclude
that coverage was immediate.” (Ahern v. Dillenback (1991) 1 Cal.App.4th 36, 47
[1 Cal.Rptr.2d 339] [automobile insurance].)
Secondary Sources
2 Witkin, Summary of California Law (11th ed. 2017) Insurance, §§ 54-56
Croskey et al., California Practice Guide: Insurance Litigation, Ch. 2-D, When
Insurance Effective; Coverage of Losses Before Policy Issued, ¶¶ 2:134-2:137,
6:428-6:448 (The Rutter Group)
2 California Insurance Law & Practice, Ch. 9, Issuance of Insurance Policies, § 9.07
(Matthew Bender)
26 California Forms of Pleading and Practice, Ch. 308, Insurance (Matthew Bender)
12 California Points and Authorities, Ch. 120, Insurance, §§ 120.19-120.20
(Matthew Bender)

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