Pennsylvania Supreme Court Upholds Homeowner's Insurance Carrier's Denial of Coverage in a Drug Overdose Case

In the case of Kramer v. Nationwide Insurance, No. 103 MAP 2022 (Pa. April 25, 2024) (Op. by Donohue, J., Dougherty, J., Concurring, Mundy, J., Concurring), the court addressed the scope of a controlled substance abuse exclusion found in a homeowner’s policy.

According to the Opinion, the dispute between the insureds and the homeowner’s carrier arose after a fatal drug overdose of the Plaintiff's decedent within the insured Defendant's home. The family of the decedent sued the homeowners and their son for wrongful death and survival action claims.

The homeowners sought coverage under their insurance policy with Nationwide.  Nationwide denied coverage based upon a controlled substance exclusion in the policy. The homeowners then filed this declaratory judgment action.

The Pennsylvania Supreme Court held that the finding of the Superior Court that the carrier was potentially required to pay out for emotional and mental distress damages was contrary to the unambiguous provisions of the policy and erroneous as a matter of law.

The Pennsylvania Supreme Court concluded that Nationwide had no duty to defend the underlying lawsuit because emotional and mental distress damages in the wrongful death claims were not "bodily injuries" as that term was considered under the policy language at issue.

Anyone wishing to review a copy of this decision may click this LINK.  Justice Dougherty's Concurring Opinion can be viewed HERE.  Justice Mundy's Concurring Opinion can be viewed HERE.

Source of image:  Photo by Tierra Mallorca on www.unsplash.com.

Court Addresses Policy Definition of "Bodily Injury" in Context of Opioid Cases

In the case of Giant Eagle, Inc. v. Am. Guarantee & Liab. Ins. Co., No. 2:19-CV-00904-RJC (W.D. Pa. Nov. 9, 2020 Colville, J.), the court ruled that the Defendant insurance company had a duty to defend the Plaintiffs in multiple lawsuits where the Plaintiffs asserted claims of “bodily injury” allegedly caused by the insured’s distribution and sale of prescription opioids. 

The Defendant carrier argued that the Plaintiffs’ Motion should be denied as the Plaintiff failed to meet their burden of establishing that the Complaints in the underlying lawsuits sought damages for “bodily injury” caused by a single “occurrence” that first manifested during the periods of coverage.

In denying the carrier’s Motion, the court pointed to several court decisions which have interpreted similar “bodily injury” insurance policy provisions in conjunction with similar opioid and epidemic lawsuits and found that those underlying lawsuits that were seeking damages due to claims of "bodily injury."  The court found that the carriers in this case failed to sufficiently distinguish those cases.

More specifically, the court found that, although the particular Plaintiffs in these lawsuits did not allege that they personally suffered bodily injury or damages, those Plaintiffs were still seeking damages because of claims arising out of a "bodily injury."   

Anyone wishing to review a copy of this decision may click this LINK.


Source: “Digest of Recent Opinions.” Pennsylvania Law Weekly (Nov. 24, 2020).

PTSD May Constitute a "Bodily Injury" For a Claim for First Party Benefits

In the case of Evans v. Travelers Ins. Co., 2019 Pa. Super. 353 (Pa. Super. Dec. 4, 2019 Panella, P.J., Stevens, P.J.E., and Kunselman, J.), held that an insured who suffers from post-traumatic stress disorder may be covered under first party medical benefits following a motor vehicle accident under an analysis that such an injury constitutes a “bodily injury” under the policy when the disorder is accompanied by physical manifestations.

The automobile insurance policy at issue allowed the Plaintiff to pursue first party medical benefits if she sustained a bodily injury as a result of a motor vehicle accident.

The medical expenses allowed under this provision included expense related to care for psychological services. Bodily injury was defined as an illness, disease or death.

The carrier attempted to argue that the Plaintiff's PTSD was not a "bodily injury." As noted, this argument was rejected, particularly where, as here, the were issues of fact as to whether the Plaintiff had physical symptoms as a result of her PTSD.

Anyone wishing to review a copy of this decision may click this LINK.