THE CASE OF THE DRIVER WHO HAD ONE TOO MANY

Fred was insured under a life insurance policy with double indemnity coverage. The policy had a face amount of $1 million. Two weeks after taking out the policy, Fred was driving home from a party while intoxicated. He lost control of his car and was killed when the car hit a utility pole. His insurance company refused to pay the double indemnity amount, and Fred's wife sued the company to force payment.

The Trial

Testimony at the trial proved conclusively that Fred was very intoxicated when he left the party. There was also proof that there was nothing in the policy about no coverage in the event of an accident due to intoxication.

The Arguments at Trial

The insurance company's attorneys argued that double indemnity provisions apply only to death due to accidents and that although Fred was in an accident, his death was due to his being intoxicated and not the accident. They further argued that this concept was so logical that it did not need spelling out in the insurance policy. The estate's attorneys argued that because the policy was silent about accidents due to intoxication, the double indemnity provision should apply regardless of the cause of the accident.

Questions for Discussion

1. Who do you think has the stronger argument, the insurance company or Fred's estate?

2. If you were the judge hearing this case, how would you decide? Why?

3. Based on your reading of the text, do you think that the double indemnity provision of the policy would apply?

4. What do you think the rule regarding coverage of accidents due to use of drugs or excessive alcohol should be?