Accidental Death Policies

Accidental Death Policies Do They Cover Death Due to Alcohol or Drug Use? By Eric Hulett Accidents are one of the five leading causes of deaths in the United States, surpassed only by heart disease, cancer, chronic lower respiratory diseases, and stroke. Accidents account for 38 percent of deaths for those aged 1 24 years, 26 percent for those aged 25 44 years, 32 percent for those aged 45 64 years, and 26 percent for those aged 65 and over. See Ctrs. for Disease Control and Prevention, Death in the United States 2011, NCHS Data Brief, No. 115 (Mar. 20, 2013), http://www.cdc.gov/nchs/data/databriefs/db115.htm#are. Unfortunately, the tragedy of accidental death is far too often compounded by a decedent s use of alcohol and drugs. A life insurance policy or a stand alone accidental death and dismemberment (ADD) insurance policy often provides insurance benefits for accidental death. A considerable volume of case law has developed around whether a death involving alcohol or drug use as a factor is an accident under a life or ADD policy. The case law involving claims for accidental death benefits when the death was caused by alcohol or drug consumption falls into three broad categories. For alcohol intoxication, the cases can be divided into three categories: (1) in the majority of cases courts have decided that drunk driving death is not an accident; (2) in a minority of cases courts have decided that drunk driving death is an accident; and (3) some courts have taken a duck the question approach to find that a policy exclusion precludes coverage. For drug ingestion, the cases can be divided into three categories. Courts (1) typically will deny coverage when they find ingestion of illicit drugs caused death; (2) typically will deny coverage when they find deliberate abuse of prescription drugs cause death; and (3) have reached varied results when they find overdose of prescription medication caused death. See Douglas R. Richmond, Drunk in the Serbonian Bog: Intoxicated Drivers Deaths as Insurance Accidents, 32 Seattle U. L. Rev. 83, 83 86 (2008); Marcus Wilbers, Note, Alcohol Related Car Accidents? 71 Mo. L. Rev. 471 (2006); Buhite, et al., Drugs, Alcohol, and Accidental Death Coverage, 39 Tort Trial & Ins. Prac. L. J. 985 (2004). 1

Courts struggle to define accident. Courts use an objective standard, focusing on the foreseeability of an event, to determine whether an insured s loss was an accident. An accident, therefore, usually refers to an unexpected, unusual, or unforeseen event that happens by chance or fortuitously and without intention or design. However, in some situations an insured voluntarily exposes himself or herself to a risk, but these situations do not categorically preclude accidental death benefits. Many courts conclude that under these situations an insured s loss will be considered an accident as long as the insured reasonably believed that his or her conduct would not result in injury or death. Other courts reason, on the other hand, that when an insured s loss is the probable result of his or her conduct, the loss is not accidental because the insured likely intended the result. See Gary Schuman, Dying Under the Influence: Drunk Driving and Accidental Death Insurance, 43:4/44:1 Tort Trial & Ins. Prac. L. J. 2, 22 38, 51 53 (2008). Courts have considered several factors when determining whether an occurrence was an accident: Whether those instances of harm fall within the basic threshold terms of an accident insurance policy depends on whether the initial contact and/or the resulting harm occur in a sufficiently unexpected or unforeseen manner that they can be characterized as an accident, accidental, or by accidental means. Accordingly, the determination of coverage in the absence of an applicable exclusion depends to a large degree on: (1) how large a role the insured s own actions played in the incident; (2) whether voluntary actions were with the intent to cause harm or with sufficient knowledge to foresee it; and (3) whether the jurisdiction deems the policy to impose a threshold of accidental means, or only accidental results. 10 Couch on Ins. 143:64. Accidental Means or Accidental Results: Wickman Test To ease the difficulty in determining whether an insured s death was an accident, insurance companies and courts began differentiating between accidental means and accidental results. An accidental means policy would provide benefits only if an insured s death was independent of all other causes. Accidental means policies ensure that benefits will only be paid if an insured s death is purely accidental as opposed to the result of an intentional act that produces an unintended consequence. In this context, 2

means is intended to be synonymous with cause. See Douglas R. Richmond, Drugs, Sex, and Accidental Death Insurance, 45:1 Tort Trial & Ins. Prac. L. J. 57, 66 69 (2009). The Wickman case has been frequently cited in this area of the law in fact, in 316 citations in court decisions as of September 2, 2013 particularly for alcohol consumption cases. Schuman, supra, at 18 26, 53; Richmond (Drugs, Sex, and Accidental Death Insurance), supra, at 69 72; Richmond (Drunk in the Serbonian Bog), supra, at 95 98. The First Circuit in Wickman v. Northwestern National Insurance Company, 908 F.2d 1077 (1st Cir. 1990), developed the often cited, two part test for determining whether an insured s beneficiary was entitled to accidental death benefits following an insured s alcohol related death. The Wickman test was designed to provide clarity to the accidental means versus accidental results dichotomy. First, a court must ask whether an insured reasonably expected a similar injury to occur. Id. at 1088. If an insured did not believe that a similar injury would occur, the court must determine whether the insured s belief was reasonable. Id. Second, if a court is unable to determine the insured s subjective belief, the court must determine whether a reasonable person in the same situation would have viewed the injury as likely to occur as a result of the insured s conduct. Id. In Wickman, the decedent left his car in a break down lane near a bridge and was observed standing on the outside of the bridge s guardrail, holding the railing with only his right hand. Id. at 1080. The decedent then fell from the bridge to the railroad tracks approximately 40 feet below. Id. It was never determined whether the decedent slipped or jumped. Id. Applying the two part test, the First Circuit determined that the decedent s death was not accidental because the decedent either intended to jump off the bridge or it was unreasonable for the decedent to place himself in such a risky circumstance and expect to survive. Id. at 1088 89. While Wickman has been most frequently cited by federal courts in ERISA cases and state courts have not rushed to adopt it explicitly, the rationale of Wickman is consistent with many state court decisions and has been recognized by authoritative commentators as applicable beyond the ERISA context. ERISA This article will not address ERISA cases specifically. In summary, the Wickman test has been most commonly applied in accidental death benefits cases governed by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001, et seq. As a reminder, courts usually employ the arbitrary and capricious standard of review when reviewing an administrator s decision to deny payment of benefits. 3

Federal courts applying the Wickman test have nearly universally determined that alcoholrelated injuries and deaths are not accidents under ERISA and, therefore, deny the beneficiaries claim for accidental death benefits. See, e.g., Miller v. Auto Alliance International, Inc., 953 F. Supp. 172, 177 (E.D. Mich. 1997) (finding that MetLife s determination to deny accidental death benefits was not arbitrary and capricious because the dangers of drunk driving are widely known and publicized, and, as such, the insured should have foreseen the consequences of driving under the influence); Eckelberry v. ReliaStar Life Ins. Co., 469 F.3d 340 (4th Cir. 2006) (upholding the administrator s determination to deny accidental death benefits because death was not unexpected or unforeseeable when the decedent drove with a blood alcohol limit that was 50 percent above the legal limit); Pankiw v. Fed. Ins. Co., 316 F. App x 458, 462 (6th Cir. 2009) (upholding the administrator s determination that the death of the plaintiff s son, who died in a high speed police chase while unlicensed and driving under the influence, was not an accident because no reasonable person could expect to walk away unscathed ). See also Marcus Wilbers, Alcohol Related Car Accidents? The Eighth Circuit Moves toward Policy Change in ERISA Litigation, 71 Mo. L. Rev. 471 (2006) (discussing accidental death benefits under ERISA); Gary Schuman, Dying Under the Influence: Drunk Driving and Accidental Death Insurance, 43:4/44:1 Tort Trial & Ins. Prac. L. J. 13 22 (2008) (same). Intoxication The case law concerning the payment of accidental death benefits following an insured s death while intoxicated can be divided into three major categories. First, a majority of the cases take the approach that a drunk driver s death is not an accident for the purpose of awarding accidental death benefits. Second, a minority of the cases take the approach that a drunk driver s death is accidental, and therefore the driver s insurance beneficiaries are entitled to receive accidental death benefits. Third,, some cases have taken a duck the question approach, which denies accidental death benefits without determining whether an insured s death was an accident, instead relying on a specific exclusion in the policy that precludes accidental death coverage for that event. See Richmond, 32 SEATTLE U. L. REV. at 98. The majority of courts have determined that the beneficiaries of an insured who is killed while driving intoxicated are precluded from receiving accidental death benefits because the insured s death is not considered an accident. Courts that follow the majority approach view the insured s decision to drive while intoxicated as voluntary, and as such do not view the insured s death as an accident. The insured s injury or death cannot fall under the definition of accident unexpected, unusual, or 4

unforeseeable because the insured knowingly drank alcohol and drove. Even if the insured did not intend or foresee harm, courts further believe that a reasonable person would know that driving under the influence would likely lead to serious injury or death. See Schuman, 43:4/44:1 Tort Trial & Ins. Prac. L. J. at 9 12 (citing cases). In contrast, a minority of courts reviewing accidental death benefits cases stemming from drunk driving hold that the insured s death may be accidental. Those courts reason that an insured would not reasonably expect that driving under the influence would result in serious injury or death because only a small percentage of drunk driving incidents result in death, and the insured likely intends to arrive at her destination safely. See Schuman, 43:4/44:1 Tort Trial & Ins. Prac. L. J. at 12 (citing cases). The third approach denies an award of accidental death benefits, not because the insured s death was considered non accidental, but because the policy includes an intoxication exclusion, narcotics exclusion, or other exclusion. For example, an intoxication exclusion precludes coverage for losses caused when the insured s blood alcohol content is greater than that jurisdiction s legal limit for operating a motor vehicle or for injuries occurring while under the influence. Some accidental death policies also contain an exclusion for self inflicted injuries, although most courts do not consider an insured s death to be self inflicted merely because the insured consumed alcohol and then drove while under the influence, unless the insured intended to cause his own death. See Richmond, 32 Seattle U. L. Rev. at 113 14 (citing King v. Hartford Life & Acc. Ins. Co., 414 F.3d 994 (8th Cir. 2005) (en banc); Carter v. Sun Life Assur. Co., 2006 WL 1328821, at *10 (E.D. La. May 11, 2006); Cranfill v. Aetna Life Ins. Co., 49 P.3d 703 (Okla. 2002)). In Morgan v. Fortis Benefits Insurance Company, 107 P.3d 267 (Alaska 2005), the insured was killed when her vehicle ran into a telephone pole. The toxicology report revealed that the insured s blood alcohol content was 0.247, far above the legal limit. Id. at 268. The insured s accidental death benefits policy contained an exclusion for losses resulting directly or indirectly from intoxication. Id. at 270. The policy further defined intoxication as having blood alcohol content greater than the jurisdiction s legal limit. Id. The life insurance company denied payment of the accidental death benefits. The trial court granted summary judgment on the basis that a reasonable person would regard the insured s intoxication as the cause of the accident that led to her death, and the Alaska Supreme Court affirmed, holding that the evidence was sufficient to show that the insured s death was directly or indirectly caused by intoxication and therefore the accidental death benefits were excluded. Id. Car crashes are not the only type of alcohol related deaths. Regurgitation and choking frequently will cause alcohol related deaths. 5

Death or disability resulting from the mechanical action of food or drink is universally, or near so, held to result from accidental means. The decisions are less uniform on the question whether death from asphyxiation or suffocation due to the aspiration of regurgitated or vomited material is caused by external, violent, and accidental means within the terms of a policy providing indemnity for accidental death. Some authority has found such harm to be within coverage, though other courts have reached the opposite conclusion. To some degree, these differing determinations may reflect differences in the initial cause of the regurgitation. For example, the fact that regurgitation followed overindulgence in alcohol has been noted in some cases denying recovery. 10 Couch on Ins. 143:72. Narcotics Similar to the case law concerning intoxication, the case law regarding deaths resulting from drug abuse or misuse generally falls into three categories. First, some cases involve illicit drugs such as cocaine or heroin. Second, some cases involve the deliberate abuse of prescription medications or the unlawful acquisition of prescription medication. Third, some cases involve an overdose of a prescription medication lawfully prescribed. Courts generally consider an insured s death from illicit drugs to be nonaccidental and an insured s death from a valid prescription to be accidental. In determining whether an insured s death from an overdose was accidental, courts more frequently favor the accidental means versus accidental results dichotomy than the Wickman test. See Richmond, 45:1 Tort Trial & Ins. Prac. L. J. at 72. In some jurisdictions, the fact that a person swallows a substance is regarded as giving rise to an almost irresistible inference that he or she did so voluntarily. 10 Couch on Ins. 143:71. Regarding the use of illicit drugs, such as cocaine or heroin, most courts have determined that an insured s death resulting from an overdose is either nonaccidental or a self inflicted injury. Courts typically reason that an insured knew or should have known the dangers of using illicit drugs, and an insured s death cannot be accidental when the insured deliberately exposed himself to a foreseeable risk of serious injury or death, even if the insured did not intend that result. See Richmond, 45:1 Tort Trial & Ins. Prac. L. J. at 72. 6

For example, in Weil v. Federal Kemper Life Insurance Company, 866 P.2d 774 (Cal. 1994), the insured died of a cocaine overdose, and the life insurance company denied the beneficiaries the accidental death benefit. Relying on the accidental means versus accidental results dichotomy, the California Supreme Court determined that accidental death benefits are not valid under an accidental means policy because the insured knew or should have known that death was a common, natural, or substantially likely result from consuming illegal substances. Id. at 787 88. Courts typically deny accidental death benefits when an insured knowingly abuses prescription medications or acquires prescription medications illegally under the same rationale as illicit drug usage. Some courts do not distinguish between use of illicit drugs and intentional abuse of prescription medications, and as such deny coverage because the insured s death was either nonaccidental or intentionally self inflicted. See Richmond, 45:1 Tort Trial & Ins. Prac. L. J. at 77 78. Death or injury which results from the negligent or accidental taking of a harmful drug, or taking a drug in such quantity or prepared in such a way that it is harmful, is generally held to be a death or injury from accident or by accidental means. Death by intentional injection of narcotics which caused a hypersensitivity reaction was found to be accidental especially in light of the fact that the insured contracted hepatitis from his or her injections. Voluntary and intentional ingestion of alcohol has been held not to satisfy the requirement that bodily injuries arise out of accidental means, at least in the absence of any contention that mischance, slip or mishap occurred to cause the insured to consume more than he or she intended. 10 Couch on Ins. 143:67. In Gatt v. Continental Casualty Company, 2006 U.S. Dist. Lexis 64996 (N.D. Ga. Sept. 12, 2006), the insured underwent spine surgery and was prescribed 60 oxycodone pills for pain. Four days later, the insured died from oxycodone toxicity. Id. at 6. The coroner s note stated that 21 pills were missing from the insured s prescription bottle, when only six pills should have been missing per the directions on the bottle. Id. at 5. Relying on the accidental means approach, the court determined that the insured s death was nonaccidental because no evidence was presented to suggest that the insured s consumption of oxycodone was anything other than voluntary and intentional. Id. at 8. Some courts, however, reason that an insured s death from prescription drug misuse may be accidental under certain circumstances. In Hardy v. Beneficial Life Insurance Company, 787 P.2d. 1, 2 (Utah Ct. App. 1990), the insured, a habitual abuser of prescription drugs obtained under false 7

pretenses, died from an overdose of narcotics not prescribed by a physician for medical purposes. The court determined that, although the insured s drug abuse reflected recklessness and poor judgment, no evidence existed to suggest that the insured intended to die on each occasion he consumed narcotics. Id. Because the insured had an extensive experience with drug abuse, the court reasoned that the insured could not have believed that his consumption of narcotics that night would cause his death. Id. In cases involving an insured s death from overdose of a lawfully prescribed medication, there is a good deal of confusion, and no overall rule can be gleaned from the case law, but courts more frequently side with the beneficiaries and award accidental death benefits. In those jurisdictions in which a distinction has been drawn between the term accidental means and the terms accident or accidental death, death from the insured s voluntary act in taking an overdose of medicine or drugs does not constitute a death from accidental means, unless it appears that there was a mistake in the taking of the overdose. In those jurisdictions where the distinction between the terms accidental death or accident and the term death by accidental means has been repudiated, the insured s beneficiary is entitled to recover on the policy if death was not intended by the insured as a result of taking what proved to be an overdose of a drug or medicine. Accordingly, the non suicidal death of an insured through a self administered overdose of narcotics has been regarded as caused by accidental means within a double indemnity provision. 10 Couch on Ins. 143:69. In Santaella v. Metropolitan Life Insurance Company, 123 F.3d 456, 459 (7th Cir. 1997), the insured was found dead in her home, and an autopsy revealed that the insured s death was from an overdose of Darvon. In the autopsy report, the insured s death was listed as accidental because the insured had a fairly low dosage of Darvon in her blood, and the doctor eliminated natural causes and suicide as other possible causes of death. Id. at 459. Applying the Wickman test, the Seventh Circuit noted that the insured did not expect or intend her final dose of Darvon to be fatal. Id. at 463. So the court determined that the insured subjectively believed she would survive her final dose of Darvon, and aided by the testimony of the physician who conducted the autopsy, the insured s subjective belief was determined to be objectively reasonable. Id. at 464. Therefore, the insured simply made a fatal mistake, and her death was properly considered an accident. Id. at 465. 8

Additionally, some courts, rather than determining whether the insured s death was accidental, deny accidental death benefits under a policy exclusion for deaths caused by drugs except as prescribed by a physician. See, e.g., Guin v. Fortis Benefits Ins. Co., 256 F. Supp. 2d 542 (E.D. Tex. 2002). In these situations, the court considers not only whether the insured was prescribed the medication by a physician but also its usage. Therefore, if the insured uses the prescribed substance in a manner or amount not advised by the physician, a court may uphold the administrator s decision to deny payment of benefits. See, e.g., Hammer v. Aetna Life Ins. Co., 465 F. Supp. 2d 491 (D. S.C. 2006) (denying accidental death benefits for insured s death from an overdose of prescription medication taken in excess because policy precluded benefits for use of alcohol, intoxicants, or drugs, except as prescribed by a physician); Duncan v. Cuna Mut. Ins. Soc y, 614 S.E.2d 592 (N.C. App. 2005) (denying accidental death benefits for insured s death from methadone toxicity under policy exclusion precluding benefits for a loss resulting from the insured s voluntary use of any drug, medicine, or sedative, except as prescribed by a physician). The Runion Case An instructive decision on whether drug induced automobile accidents are covered under accidental death policies was provided by the United States District Court for the Southern District of West Virginia. The case involved the tragic death of a driver mother and her infant passenger due to intentional drug ingestion. The district court, applying West Virginia substantive law and federal procedural law, granted summary judgment to Minnesota Life on the accidental death benefits portion of the group life policy because the insured driver s actions in driving after consuming a large quantity of oxycodone, recklessly driving into the wrong lane of traffic, not wearing a seat belt, and not placing her 10 month old son in a car seat or in a seat belt, which caused both their deaths, was excluded from coverage under the drug abuse exclusion and the commission of a felony exclusion. Runion v. Minnesota Life Ins. Co., 2013 WL 2458541 (S.D. W.Va. June 6, 2013). Runion was driving south on U.S. 35 in Putnam County, West Virginia. She crossed into the northbound lane, ran one car off the road, travelled some additional distance in the wrong direction, and collided with a tractor trailer. Runion and her 10 month old son were in the car. Neither was wearing a seat belt. The baby was not in a car seat, although a car seat was in the back seat of the car. Toxicology tests revealed oxycodone and oxymorphone in Runion s system. The oxycodone was at a toxic level, according to the medical examiner (0.27 mg/l found, therapeutic dose 0.01 0.10 mg/l). 9

The medical examiner concluded that the cause of death was oxycodone impaired driving. Runion, 2013 WL 2458541, at *1. Minnesota Life paid the life insurance benefit but denied the accidental death benefit claim. The accidental death provision of the policy provided benefits for accidental death... which occurs as a result of an accidental injury. In the policy accidental death by accidental injury was defined as that the insured s death... results, directly and independently of all other causes, from an accidental injury which is unintended, unexpected, and unforeseen. Exclusions included the insured s participation in or attempt to commit a felony and the abuse of drugs... voluntarily taken... except as administered by a licensed medical professional. Minnesota Life denied accidental death benefit claim because A fatal motor vehicle crash while driving under the influence of drugs does not qualify as an accidental injury under the policy. The crash was caused by Runion driving under the influence causing death, which is a felony. The crash was caused by Runion s abuse of drugs. The district court ducked deciding whether the crash was an unforeseeable accident and granted a summary judgment to the insurer based on the exclusions. The court concluded that the Drug Abuse Exclusion and the Felony Exclusion precluded coverage. Relevant to the Drug Abuse Exclusion, the court noted that Runion did not have a prescription for oxycodone or oxymorphone at the time of her death, [t]herefore, at the time of her death, Ms. Runion had ingested a high quantity of oxycodone and a quantity of oxymorphone, all without a valid prescription, and was thus abusing drugs. Runion, 2013 WL 2458541, at *8. The court offered to other points relevant to the Drug Abuse Exclusion: there is no evidence in the record that the drugs were not consumed voluntarily, or that the drugs were administered by a licensed medical professional.... Finally, for the same reasons discussed supra regarding the felony exclusion, the Court concludes that Defendant has produced sufficient evidence establishing the causation element for this exclusion as well. Id. Relevant to the Felony Exclusion the court wrote the following: Despite the complete lack of evidence suggesting that the collision occurred as a result of anything but Ms. Runion s reckless operation of her motor vehicle, Plaintiff argues 10

that Defendant must pay accidental death benefits because it cannot prove that the amount of drugs in Ms. Runion s system contributed to her reckless driving, which resulted in her death. The Court disagrees with Plaintiff and finds that there is sufficient undisputed evidence that Ms. Runion was driving under the influence of a controlled substance and that this caused both her and her son s death.... Thus, there is no evidence that Ms. Runion was driving in the wrong lane very briefly due to some momentary distraction wholly unrelated to the presence of drugs in her system. Id. at *4. The plaintiff argued that the toxicology results were not conclusive because they failed to account for tolerance to the drug. However, there was no evidence presented that Runion had developed a tolerance for oxycodone. And the court noted, Meanwhile, Defendant has produced evidence showing that the amount of oxycodone in Ms. Runion s blood at the time of her death was at a level nearly three time that of a therapeutic dose. Id. at *5. The reckless disregard for the safety of others element of a felony was met. Ms. Runion consciously chose to place her 10 month old child in the front passenger seat of her vehicle without a child safety seat or a restraint of any kind. She did so despite the fact that a child safety seat was already available and properly installed in the rear seat of her vehicle.... Knowing that her child was unrestrained in the front seat, Ms. Runion then decided to operate the vehicle, having ingested both oxymorphone and nearly three times the therapeutic dose of oxycodone. While operating the vehicle, Ms. Runion crossed the center line and drove against the flow of traffic, even after one car swerved off the road to avoid colliding with her vehicle. All these actions clearly demonstrate that Ms. Runion possessed a reckless disregard for the safety of her son, others on the road, and herself.... The Court concludes that Defendant has met its burden of proving that Ms. Runion s loss falls within the [felony] policy exclusion. Id. at *7. Runion: Lessons Learned Some of the most useful teaching points are not contained in the text of a published decision. The same is true with the Runion decision. The author interviewed John Teare, the successful counsel for 11

Minnesota Life, in the Runion case. Mr. Teare noted that the court reacted quite strongly to the fact that Runion had her infant son in the car but not secured in a car seat. Witness statements from the scene of the accident were also presented to the court. This evidence was not found in the official accident report. The local county sheriff conducted an investigation and produced an investigation report containing much damning information. The claim file did not contain the investigation report. Once this report was located by counsel, it was attached to the motion for summary judgment as an exhibit. The plaintiff did not object to the admissibility of any portions of the investigation report nor ask that it be struck from the record. This evidence helped persuade the court that the Felony Exclusion applied because the applicable West Virginia criminal statute required a finding of reckless disregard in addition to driving under the influence. This case shows that a great deal of persuasive evidence that can with some forethought be linked to elements of the coverage determination can be put before a court in addition to the bare forensic medical evidence of drug or alcohol ingestion. Conclusion The use of alcohol or drugs contributing to a death does not necessarily mean that an ADD policy will not offer coverage. The particular facts of a case are just as critical as the specific policy language. The need to thoroughly investigate the facts cannot be overemphasized. Familiarity with the extensive case law interpreting these issues is also critical. Successful coverage determination will then be no accident. 12