[56 NJSuper Page 186] This matter is before the court for determination on cross-motions of plaintiff and defendant, which cross-motions present the question of whether or not the death of the insured on April 22, 1958 was within the 31-day grace period for the payment of premiums. Stated
another way, the primary question is whether or not the policy had lapsed on April 22, 1958, the date the insured died.
Franklin Life Insurance Company insured the life of Morton Kampf for 20 years, with a provision for payment of $100 monthly income to the named beneficiary. The application for insurance was made on September 5, 1956, and the description of the policy therein read: "a. Plan of Policy Home Protector -- 20." It provided that premiums were to be paid quarterly. At the bottom of the application (Part 1) it read:
"IT IS HEREBY AGREED: * * * (2) that any policy issued hereon shall not take effect unless and until the policy has been delivered to the undersigned and the first premium paid during the lifetime and good health of the Proposed Insured (except as provided in the Receipt bearing the same number and date as this application if the entire first premium has been paid and acknowledged above and such receipt issued) in which event such policy shall be deemed effective as of the beginning of the first policy year as shown on such policy; * * *."
The first premium was paid and the policy delivered to the insured on September 24, 1956. The policy, in part and so far as pertinent to the issue here presented, reads as follows:
"CONSIDERATION: The insurance is granted in consideration of the application herefor and of the payment in advance of the premiums as herein provided. The first premium in the amount specified on the first page, is payable at the beginning of the first policy year and subsequent premiums are payable on the anniversary of said date in every year thereafter until premiums have been paid for the period specified on the first page.
PREMIUMS: This Policy is based upon the payment of premiums annually in advance but premiums for the first and subsequent policy years may be paid semi-annually or quarterly in advance or, at the option of the Company, they may be paid monthly in advance. Each semi-annual, quarterly or monthly premium shall be in accordance with the rates in use by the Company at date of issue hereof. * * * Failure to pay any premium when due shall cause this Policy to cease and determine except as herein otherwise provided, and all payments made hereon shall remain the property of the Company.
GRACE PERIOD: A grace period of thirty-one days, without interest charge, will be allowed for the payment of every premium
after the first, during which period this Policy shall remain in force. If death occurs within the grace period, the premium, if unpaid, will be deducted from the amount payable hereunder.
ENTIRE CONTRACT: This Policy and the application therefor, a copy of which is hereto attached and made a part hereof, constitute the entire ...