The opinion of the court was delivered by: Oxner, Justice.
Appellants are Indiana corporations. Neither has been licensed to do business in South Carolina. Neither maintains any office, has any agent or owns any property in this State. In September, 1948, respondent, a resident of South Carolina, applied by mail to appellant American Standard Insurance Corporation for an accident and health insurance policy. The application was duly accepted in Indiana and on October 14, 1948, the policy was mailed to respondent and received by him at Greenville, South Carolina. The annual premium of $264.00 was regularly mailed to the American Standard Insurance Corporation until January, 1955, when respondent was notified that the American Income Life Insurance Company had entered into a reinsurance agreement with the American Standard Insurance Corporation under which all outstanding policies of the American Standard were reinsured by American Income. Respondent duly received and accepted a reinsurance certificate from American Income and thereafter paid all premiums by mail to that Company. Respondent claims that the insurer wrongfully cancelled said policy on May 14, 1956.
Service of the summons and complaint in each action was had upon the Insurance Commissioner in accordance with the terms of the South Carolina Uniform Unauthorized Insurers Act, Title 37, Chapter 3, Article 8 of the 1952 Code, the pertinent portion of which is as follows (Section 37-265):
It seems to be conceded that the summons and complaint in each case were promptly forwarded by the Insurance Commissioner to appellants and that they were given ample opportunity to appear and defend. They contend that this statute constitutes a denial of due process guaranteed by the Fourteenth Amendment, particularly if construed as applicable to the issuance and delivery of a single policy, and further that if the statute is valid, substituted service may not be had under it in tort actions.
In recent years there has been a tremendous growth in mail order insurance business. Many companies doing business in this manner maintain an office and own property only in the state where they are incorporated but insure risks on a nationwide basis. Frequently they have no agents or solicitors. New business is secured by advertisement and solicitation by mail. The hardship of requiring an assured or his beneficiary to hire a lawyer to prosecute small claims in a state far from the residence of the policy holder soon became evident. In order to provide the policy holder with a means of enforcing his rights without having to suffer the inconvenience and costs, oftentimes prohibitive, of suing in a foreign jurisdiction, a number of states have enacted statutes similar, in all material respects, to the one under consideration.
"Looking back over this long history of litigation a trend is clearly discernible toward expanding the permissible scope of state jurisdiction over foreign corporations and other nonresidents. In part this is attributable to the fundamental transformation of our national economy over the years. Today many commercial transactions touch two or more States and may involve parties separated by the full continent. With this increasing nationalization of commerce has come a great increase in the amount of business conducted by mail across state lines. At the same time modern transportation and communication have made it much less burdensome for a party sued to defend himself in a State where he engages in economic activity.
It is of interest to note that as far back as 1946, Judge Timmerman, in a well considered opinion in Storey v. United Insurance Company, D.C., 64 F. Supp. 896, sustained service of process on the Insurance Commissioner under our statute.
In Sanders v. Columbian Protective Association of Binghamton, N Y, 208 S.C. 152, 37 S.E.2d 533, we held that our statute did not justify service of process upon a foreign insurance company having no agents or property here where the application was made by a non-resident of South Carolina and the policy was issued and received by assured in another State. The facts in the instant case present a different situation.
It is argued in no event can service be sustained under this statute where the contact with a resident of this State consists solely of the issuance and delivery by mail of a single insurance policy. The record in the instant case is silent as to whether appellants issued other policies to residents of this State. However, we do not think it was necessary for respondent to show other transactions. The view urged by appellants has been taken by some Courts, Annotation, 44 A.L.R.2d, page 430, but we think the better reasoned cases sustain a contrary conclusion. As pointed out in Zacharakis v. Bunker Hill Mutual Ins. Co., 281 App. Div. 487, 120 N.Y.S.2d 418, 423, motion for leave to appeal granted 281 App. Div. 1019, 121 N.Y.S.2d 271, "quantity could not alone be the test of validity of a statute of this kind." In International Shoe Company v. State of Washington, 326 U.S. 310, 66 S.Ct. 154, 159, 161 A.L.R. 1057, the Court said: "It is evident that the criteria by which we mark the boundary line between those activities which justify the subjection of a corporation to suit, and those which do not, cannot be simply mechanical or quantitative. The test is not merely, as has sometimes been suggested, whether the activity, which the corporation has seen fit to procure through its agents in another state, is a little more or a little less." In McGee v. International Life Insurance Co., supra, the record showed no more than the delivery of a single insurance contract.
The final contention of appellants is that actions ex delicto are without the terms and scope of the statute. They say that any action under it must be one solely for the recovery of benefits under an insurance contract. Our attention is called to Section 37-268 of the 1952 Code which provides that before an unauthorized insurer may file any pleading in an action instituted against it, such insurer must either file a bond with surety, in an amount to be fixed by the court, sufficient to secure the payment of any judgment rendered, or procure a certificate of authority to transact the business of insurance in this State. It is argued that if the statute be ...