Citation NR: 9718109 Decision Date: 05/22/97 Archive Date: 06/03/97 DOCKET NO. 95-32 100 ) DATE ) ) On appeal from the Department of Veterans Affairs (VA) Regional Office and Insurance Center (RO) in Philadelphia, Pennsylvania THE ISSUE Entitlement to a waiver of National Service Life Insurance policy premiums effective June 1, 1970, based upon continuous and total disability and an inability to apply for an earlier waiver. REPRESENTATION Appellant represented by: Disabled American Veterans ATTORNEY FOR THE BOARD Mark D. Chestnutt, Associate Counsel INTRODUCTION The veteran served on active duty from March 1941 to June 1947. This appeal stems from a November 1994 decision of the RO that denied a waiver of premiums on the veteran’s National Service Life Insurance policy, which was considered to have lapsed June 1, 1970. The RO found that no evidence showed that the veteran had been disabled prior to September 1986, and that it was not shown there were circumstances beyond his control which prevented him from filing earlier for a waiver of premiums. The Board notes that certain non-substantive amendments, effective June 10, 1996, have been made to 38 C.F.R. § Part 8, which are pertinent to this case. Since these changes are non-substantive, a remand is unnecessary for the RO to consider them. Bernard v. Brown, 4 Vet.App. 384 (1993). CONTENTIONS OF APPELLANT ON APPEAL The veteran contends that he has been totally disabled since his separation from service, and that he was essentially unable to file for a waiver at the time the policy lapsed. He also believed that the premiums were being deducted from his military retirement pay, and that the VA never informed him that his insurance had lapsed. He believes that his mail has not been properly delivered to his address or has been intercepted over the years. DECISION OF THE BOARD The Board, in accordance with the provisions of 38 U.S.C.A. § 7104 (West 1991 & Supp. 1996), has reviewed and considered all of the evidence and material of record in the veteran’s claims file. Based on its review of the relevant evidence in this matter, and for the following reasons and bases, it is the decision of the Board that the preponderance of the evidence is against granting a waiver of the premiums that were due on the veteran’s National Service Life Insurance policy, and that the policy lapsed June 1, 1970. FINDINGS OF FACT 1. All relevant evidence necessary for an equitable disposition of the veteran’s appeal has been obtained. 2. The veteran’s National Service Life Insurance policy, which had been in force for many years, lapsed for nonpayment of premiums on June 1, 1970. 3. The evidence does not demonstrate that the veteran was totally and continuously disabled from the time his National Service Life Insurance policy lapsed to August 1994, when he applied for a retroactive waiver of premiums. 4. There is no evidence that the veteran was prevented from filing a timely claim for a waiver of premiums from the time the policy lapsed to August 1994, due to circumstances beyond his control. CONCLUSION OF LAW The veteran is not entitled to a waiver of premiums on his National Service Life Insurance policy, which lapsed on June 1, 1970. 38 U.S.C.A. §§ 1904, 1905, 1912, 5107 (West 1991); 38 C.F.R. § 3.340 (1996); 61 Fed. Reg. 29, 289-293 (1996) to be codified at 38 C.F.R. §§ 8.4, 8.5, 8.6, 8.7, 8.9, 8.20, 8.30. REASONS AND BASES FOR FINDINGS AND CONCLUSION Initially, the Board finds that the veteran’s claim is “well grounded” within the meaning of 38 U.S.C.A. § 5107. The Board is also satisfied that all relevant evidence has been properly developed and that there is no further duty to assist in order to comply with the duty to assist as mandated by 38 U.S.C.A. § 5107. The record reflects that the veteran was born in October 1915. The veteran’s National Service Life Insurance policy, a five- year level premium term plan, became effective in May 1941. Due to a period of total disability, the veteran’s premiums were waived for a period beginning November 1945 and ultimately extended to October 1947. In October 1947 it was then found that he was no longer totally disabled, and he subsequently resumed paying premiums. An additional provision for total disability insurance was added to the veteran’s National Service Life Insurance policy in May 1948. On examination by the VA in January 1951 the veteran denied hallucinations or delusions. Physical examination was essentially negative. He was diagnosed with schizophrenic reaction, latent, in partial remission. His incapacity was stated to be moderately severe. He was considered competent. A January 1951 rating decision shows that the veteran was rated as 50 percent disabled due to a service-connected psychiatric disability, and was service-connected for a noncompensable hearing loss. The veteran did not receive compensation, instead opting to receive his military retirement pay. The veteran apparently arranged to have his National Service Life Insurance premiums deducted from his military retirement payments. In November 1969 the RO notified the veteran at his address of record that his allotment for insurance premiums need to be increased to $16.50 per month, or that his insurance would lapse. No response was received. A February 1970 letter from the Department of the Army indicates that correspondence sent to the veteran had been returned as unclaimed, and that his January 1970 retirement pay had been held, pending further information concerning his whereabouts. In July 1970 the RO sent a letter to the veteran’s attorney in an attempt to locate the veteran. In August 1970 the attorney forwarded the address of an organization known as a Moose Order. The veteran’s correspondence was to be sent in care of this organization. In September 1970 the RO sent a letter to the veteran at his address of record--not the address of the Moose Order-- informing him that his insurance policy had lapsed on June 1, 1970, and advising him as to what was necessary to reinstate it. A separate “Notice of Lapse” was sent that month as well to the address of record. Both letters were returned to the VA. The Postal Service indicated that the veteran had moved and left no forwarding address. In April 1971 the VA sent a letter to the Moose Order, attempting to locate the veteran. In May 1974 a response was received from the Secretary of the Moose Order that the veteran was a night watchman there, at no pay. A room was being furnished to him at no charge. No response from the veteran himself, however, was received. A May 1971 letter from the service department indicates that the veteran’s retirement pay had been suspended at that time since his then-present whereabouts were unknown. The veteran turned 65 years of age in October 1980. The veteran was hospitalized by the VA from September 1986 to October 1986. He had been brought to the emergency room complained of abdominal pain. He had begun vomiting and retching prior to admission. The veteran was found to have a duodenal ulcer which was repaired during his hospital stay. He had also been in a state of malnutrition. It was felt that he could continue treatment at a nursing home and that further hospitalization would not be needed. A clinical record from the day of discharge indicates that the veteran was competent for VA purposes. The veteran was examined by the VA in April 1993, at which time he indicated that he had not worked for 20 years. His train of thought was noted to be completely disorganized; insight and judgment were limited, and his ability to care for himself appeared to be marginal. How he was presenting on examination was most likely how he was presenting and exhibiting at the time of discharge, the examiner stated. The examiner also stated that the veteran had not changed substantially over the years, except that the ability to recall might have been a little more impaired currently than in the past. Regarding psychotic indicators, appeared to be “consistently lessened” at that time he was discharged from service, or even prior to that, as well as currently. He was diagnosed with schizophrenic reaction, with current presentation consistent with atypical psychosis. Hypertension, hypothyroidism, peptic ulcer disease and a hearing impairment were also diagnosed. Except as otherwise provided under the law, a National Service Life Insurance policy will lapse due to the failure of the insured to make timely premium payments. See 38 C.F.R. § 8.5, 61 Fed. Reg. 29291. See generally 38 U.S.C.A. § 1908. In this case, the veteran is not attempting to reinstate his National Service Life Insurance, per se. See 38 C.F.R. § 8.13; 61, Fed. Reg. 29292. Rather, he is attempting to show that a waiver of premiums should be granted retroactively to June 1970 when the insurance lapsed. The basis for this claim is that the veteran feels he was totally disabled at that time, has been continuously totally disabled since that time, and was further unable to apply for a waiver of premiums since the time of the lapse until his present claim. Where a veteran who is insured under a National Service Life Insurance policy becomes totally disabled for six or more consecutive months, payment of policy premiums may be waived upon written application if such disability began before the insured’s sixty-fifth birthday. 38 U.S.C.A. § 1912(a). However, waiver shall not be effective as to any premium which became due more than one year prior to receipt of such application at the VA unless the insured’s failure to submit timely application was due to circumstances beyond the insured’s control. 38 U.S.C.A. § 1912(b) The definition of “total disability,” other than that for speech, was removed from 38 C.F.R. § Part 8 effective June 10, 1996. 61 Fed. Reg. 29290. See 38 C.F.R. § 8.21, as amended. Generally, however, total disability has been defined for VA adjudication purposes, and is considered to exist when there is present any impairment of mind or body which is sufficient to render it impossible for the average person to follow a substantially gainful occupation. 38 C.F.R. § 3.340(a)(1). The insured will be notified by letter [by the VA] directed to the last address of record of the termination of the authorization to deduct premiums, but failure to give such notice shall not prevent lapse. 38 C.F.R. § 8.7, as amended; 61 Fed. Reg. 29290-91. To prevail in this case, the veteran would need to show that when his insurance policy lapsed in June 1970, that he was totally disabled, and was continuously disabled from that time to the date of his application for a retroactive waiver in August 1994. Further, he must show that his failure to submit an application for a waiver during that time period was due to circumstances beyond his control. It is clear from the facts in this case that a waiver of premiums is not warranted. The medical evidence does not establish that the veteran was totally disabled in June 1970 or for many years thereafter. He was rated as fifty percent disabled at that time, and had previously been found, after a period of total disability, to be less than totally disabled in 1947. The next available medical evidence from September and October 1986 shows that the veteran was then in need of nursing home care. This evidence came several years after the veteran reached the age of 65 in October 1980. During the April 1993 VA examination the veteran reported that he had not worked for 20 years. This would place the time he last worked in 1973--after the policy had lapsed. Moreover, nothing in the record establishes that the veteran was otherwise prevented from applying for a waiver during the time period in question due to circumstances beyond his control. Even if the Board were to construe the April 1993 VA examination report as showing the veteran to have been totally disabled since service, including from the time of the lapse--a conclusion contradicted by the other evidence of record--there is no evidence whatsoever that the veteran was prevented from applying for a waiver due to circumstances beyond his control. Prior to the lapse there were many instances where the veteran applied for changes in his National Service Life Insurance policy, such as beneficiary changes, an addition of the total disability provision and the like. Even if the Board were to concede that veteran had been totally disabled since service, he apparently was able to conduct business with the VA related to his insurance and could have, therefore, presumably applied for a waiver at the time the policy lapsed. Nothing in the April 1993 VA examination report indicates that the veteran’s disability prevented him from the time of the lapse and afterward from applying for a waiver. Additionally, the Board notes that an October 1986 clinical record from the last day of the veteran’s VA hospitalization in that month shows that he was competent. 38 U.S.C.A. § 1912(b). As to his arguments that the VA did not act reasonably in its attempt to locate him, or that his mail was somehow misdirected or intercepted, the veteran had the responsibility to pay his premiums and to keep the VA advised of his proper address. His incorrect belief that the premiums were still being deducted from his retirement pay in no way relieved him from this duty. The Board notes, in fact, that his retirement pay was suspended around the time his policy lapsed, and this should have further alerted him that his premiums were not being paid. Additionally, the veteran was notified at his then-current address of record as to the loss of authority to deduct the proper amount necessary for premiums. Even if this had not been done, or had been sent to the incorrect address, this did not prevent his National Service Life Insurance policy from lapsing. 38 C.F.R. § 8.7, as amended. See Ashley v. Derwinski, 2 Vet.App. 62 (1992) (regarding the presumption of regularity: that public officers have properly discharged their official duties in absence of clear evidence to the contrary). The veteran’s claim, therefore, must be denied for the reasons as previously set forth. The evidence is not so evenly balanced that there is doubt regarding any material issue. 38 U.S.C.A. § 5107. ORDER The veteran’s National Service Life Insurance policy has lapsed. The retroactive waiver of premiums sought on appeal is denied. WAYNE M. BRAEUER Member, Board of Veterans’ Appeals 38 U.S.C.A. § 7102 (West Supp. 1996) permits a proceeding instituted before the Board to be assigned to an individual member of the Board for a determination. This proceeding has been assigned to an individual member of the Board. NOTICE OF APPELLATE RIGHTS: Under 38 U.S.C.A. § 7266 (West 1991 & Supp. 1996), a decision of the Board of Veterans’ Appeals granting less than the complete benefit, or benefits, sought on appeal is appealable to the United States Court of Veterans Appeals within 120 days from the date of mailing of notice of the decision, provided that a Notice of Disagreement concerning an issue which was before the Board was filed with the agency of original jurisdiction on or after November 18, 1988. Veterans’ Judicial Review Act, Pub. L. No. 100-687, § 402, 102 Stat. 4105, 4122 (1988). The date which appears on the face of this decision constitutes the date of mailing and the copy of this decision which you have received is your notice of the action taken on your appeal by the Board of Veterans’ Appeals. - 2 -