Trip and Fall Can Never be an Auto Accident

Clear and Unambiguous Policy Must be Enforced

Posted on March 11, 2020 by Barry Zalma

Accidental death insurance policies are usually brief and easy to read and understand. Like most insurance policies accidental death policies do not cover every possible form of accidental death.

In William Dun, et al. v. Transamerica Premier Life Insurance Company, et al., Civil Action No. 19-40 (JEB), United States District Court For The District Of Columbia (March 5, 2020) the beneficiaries of an accidental death policy learned that just because the insured died due to an accident it was not the type of accident the policy agreed to insure.

FACTS

In March 2013, Irmadell Dun, a 79-year-old resident of Bozeman, Montana, tripped on the sidewalk, struck her head, and died within a week from ensuing complications. Plaintiffs William Dun, Irene Dun, Sheryl Dun, Pat Ruggieri, and Dora Mengel, Irmadell’s children, sought accidental-death benefits from Transamerica Premier Life Insurance Company, which issued a group insurance policy. Transamerica denied their claim, explaining that Dun’s insurance only covered deaths resulting from a motor-vehicle or common-carrier accident, as opposed to any other sort of mishap.

Plaintiffs’ amended their suit twice attempting to find coverage for a non-motor-vehicle or common-carrier accident. Both parties eventually moved for summary judgment.

The court concluded that the case, at its core, is a straightforward dispute over contract interpretation. Transamerica issued an accidental-death group insurance policy that was specifically geared toward the elderly.

As to regulatory issues the insurer was able to issue a single “master policy,” hold that policy in trust in one state, and then supply individual insurance certificates across all fifty states “without dealing with fifty different regulators.” Defendant ADMS is the current Administrator of the Trust, which is declared under the laws of, and has its principal place of business in, Washington, D.C.

Irmadell Dun, was advised by the application and certificate of insurance that the policy covers every time she gets into her car with $100,000 of protection for just $4.33 monthly. Dun, then 70 and a bookkeeper by trade, signed the Enrollment Form on November 7, 2003. Once the insurer received a signed Enrollment Form, it issued the Insurance Certificate, which set forth the specific terms of coverage and provides the operative insurance contract here.

ACCIDENTAL DEATH BENEFIT

The insurer agreed to pay a benefit if an Insured dies as the result of an Injury that occurs from the following Accident Hazards:

• Motor Vehicle Hazard: This Hazard occurs if an Insured dies as a result of being Injured: a. while riding in or driving a Private Passenger Automobile; b. if struck, as a pedestrian, by a Private Passenger Automobile or any other Land Motor Vehicle; or c. while driving for hire a Land Motor Vehicle.
• Common Carrier Hazard: This Hazard occurs if an Insured dies as a result of being Injured while: a. riding as a fare paying passenger on a Common Carrier; or b. getting on or off a Common Carrier.

Dun dutifully paid the $4.33 per month she owed under the policy for nearly a decade, remitting almost $500 in total over the remainder of her life.

Following her death, Plaintiffs — Dun’s five children — filed a claim for $100,000 with Transamerica under the Certificate. Defendant denied the claim on the ground that Dun’s death was not the result of an accident involving a “motor vehicle” or “common carrier” and therefore was “not covered” by the Certificate.

ANALYSIS

At bottom, Plaintiffs’ claims, whether characterized as breach of contract or breach of fiduciary duty, rest on a single premise: that Dun’s insurance policy is properly construed as covering not just accidental death via motor vehicle or common carrier, but instead death resulting from any accident.

An insurance policy is a contract between the insured and the insurer. In the context of insurance disputes, as in all cases involving contract interpretation, whether a genuine issue of material fact is in dispute will depend generally upon whether the contract is ambiguous. A contract is not rendered ambiguous merely because the parties disagree over its proper interpretation. A contract is unambiguous when a court can ascertain the contract’s meaning by merely looking at the contract. If the Court can determine that the scope of Dun’s insurance coverage is unambiguous based on the terms of the policy alone it can resolve the dispute without conducting a trial. Plaintiffs have not explained what a factfinder would do given that contract interpretation is a matter of law and that there are no disputes of material fact.

To ascertain the scope of the contract the Court looks to the written language embodying the terms of an agreement. In doing so, it conducts a reasonableness inquiry to determine what a reasonable person in the position of the parties would have thought the disputed language means. The Court may not indulge in forced constructions to create an obligation against the insurer. If an insurance contract states in plain terms what is covered, then the man or woman in the street should be able to understand what is said.

The court concluded that the plain terms of the contract would require a reasonable person to conclude that the coverage is limited to motor-vehicle and common-carrier deaths.

Given that the contract and accompanying promotional material unambiguously limit themselves to the construction supplied by the insurer the court determined that summary judgment must be granted to the insurers not only on Plaintiffs’ breach-of-contract claim but also on their tort counts.

ZALMA OPINION

Reading the full policy the court was left with no option – the policy was limited to deaths caused by auto or commercial vehicle accidental deaths. Since Irmadell Dun died after tripping, falling and striking her head while walking and without any involvement of a vehicle of any kind, the policy provided no coverage and no benefits were owed to her beneficiaries regardless of the wild and ambitious use of language to make an auto accident into any accidental death.

? 2020 – Barry Zalma

This article, and all of the blog posts on this site, digest and summarize cases published by courts of the various states and the United States. The court decisions have been modified from the actual language of the court decisions, were condensed for ease of reading, and convey the opinions of the author regarding each case.

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at https://www.zalma.com and [email protected].

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

Over the last 52 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

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