Accidental Death Insurance Policy

We recently took an insurer to task who refused to pay in respect of a claim made on an accidental death insurance policy.

Our client’s late husband took out an insurance policy which provided for the payment of a specified sum in the event that he died from an accident as a result of physical injuries caused “solely by violent, visible and external means.”

Our client’s late husband was diagnosed with Non-Hodgkins Lymphoma for which he received chemotherapy treatment between 1998 and 1999. On 13 August 2002 a second round of chemotherapy treatment was administered in hospital. By 14 August 2002 the chemotherapy had caused an allergic reaction as a result of which the patient died. There was no question that the medical treatment was other than appropriate.

Our client made a claim on the policy. Liability for the claim was denied by the insurer on the basis that the death was not caused by “physical injury caused by violent, visible and external means.”

We commenced proceedings in the District Court seeking payment of the insured sum. It was argued on behalf of our client that the insertion of the canular into our client’s arm for the administration of chemotherapy was an event that was violent, visible and external and that the allergic reaction to a drug given during the treatment of cancer was therefore an accident which entitled our client to payment under the policy.

The proceedings in the District Court were successful. The insurer appealed to the Court of Appeal and in a Judgment on 15 December 2006 that appeal was dismissed.

The particularly pleasing aspect of this case was that the interest on the damages the insurer was required to pay exceeded the solicitor/client costs and as a result our client ultimately received a sum greater than the insured amount.

By Scott Hall-Johnston