Coverages In Disability Policies

Arlington insurance attorneys who handle disability policy claims would want to read this 1978, Beaumont Court of Appeals case. It is styled, Lone Star Life Insurance Company v. Griffin.
Griffin testified that as he was returning to his home from his farm, he passed by his drugstore. As was his custom, he entered the store to see if everything was normal (having been burglarized several times in the past). He smelled smoke which he found to be coming from the rear of his building. He testified that he emptied his fire extinguisher but his efforts were futile; that he was trying to get out of the building when an aerosol can exploded in his face; that he lost consciousness while upon the floor of the store near a door, and regained consciousness later in a hospital in Jasper.
Dr. Lee Popejoy testified as to his treatment of Griffin beginning at about two in the morning following the fire. He told of finding external burns on several parts of Griffin’s body but the most serious injury was to his lungs from the inhalation of smoke and fumes. Griffin was hospitalized for several weeks and testified that he was unable to do any work for several months thereafter.
Griffin operated a one-pharmacist store and he secured the services of a retired pharmacist to help him for a while. He testified that he was unable to do the work of a pharmacist because of his difficulty in breathing and that while his health had improved, he still was unable to do his work in the store.
Dr. Popejoy testified positively and unequivocally that Griffin’s injuries were caused by the inhalation of the smoke and fumes which resulted in his total and permanent disability. Dr. Charles Anderson examined Griffin for Lone Star. His examination was more than two years after the accident and he found Griffin to be only partially disabled, at the worst. Anderson attributed Griffin’s condition to his constant smoking of cigarettes which he admitted to have been addicted to for approximately fifty years. Anderson testified that Griffin could do all of the work of a pharmacist but could not do any sustained heavy lifting.
The policy of insurance provided that Lone Star would pay Griffin $1,000 per month for sixty months for an accidental injury resulting in total disability and that it would pay $1,000 per month for twenty-four months for total disability resulting from sickness. Lone Star paid several monthly payments of $1,000, noting on each check that the payment was for accidental injuries. Without any change in its medical information in its file and for some undisclosed reason the checks were coded to indicate that the disability was the result of sickness, not an accident. The twenty-fourth payment was coded to indicate a sickness disability payment and a letter was written which we quote in the margin. The check indicated it was the last payment.
Griffin alleged and now contends that Lone Star, by sending the quoted letter, “repudiated the provisions of its policy dealing with payment of benefits for disability resulting from accident” so as to entitle him to recover not only the past due payments but “also the present cash value of the future payments which are unaccrued.” Although Lone Star contended that there was no anticipatory breach, the parties stipulated that a discount rate of five percent would be applied (and it was so applied) to the unaccrued payments in the judgment.
The court upheld the jury finding that Lone Star breached the insurance contract and allowed recover of the amount due under the policy plus attorney fees and penalty.