McDevitt v. Reliance Standard Life Insurance Co. (Maryland U.S.D.C.)

Filed October 13, 2009
Opinion by Judge J. Frederick Motz

Held: Medical condition caused by inhalation of toxic fumes was an "illness" under the terms of a worker's disability insurance policy. It was not an "injury" which would be excluded from coverage.

Facts: The plaintiff suffered a harm when he inhaled toxic fumes in the course of his employment. This manifested in the form of pneumonia. He claimed disability insurance benefits, and his carrier denied the claim, asserting that the condition was excluded pursuant to the terms of the policy. The policy excluded coverage for "injury" occurring in the course of employment.

Analysis: Relying in part on the dictionary, the court held that the condition was an "illness", not an "injury". The court stated that "insurance policies must be construed not in the context of academic discourse but in the context of the language used by ordinary persons whose contractual relationships the policies are intended to govern."

The court also opined that “the ultimate purpose of insurance is to provide coverage to those who have contracted for it (or who are beneficiaries of a contract made on their behalf by an employer or other third party). It is not to erect administrative barriers, increase transaction costs, or delay the payment of legitimate claims. Whenever a non-governmental insurer becomes blind or indifferent to this simple proposition, public confidence in the integrity and efficacy of the system of private insurance inevitably is eroded.”

The full opinion is available in PDF.