Insurer Need Not|Pay For Clerk’s Death

     (CN) – The family of an Indiana liquor store clerk who was tied to a tree and beaten to death by a robber cannot collect a wrongful death award from an alarm company’s insurer, the Indiana Supreme Court ruled.

     The court reversed an appeals court ruling that the alarm company’s umbrella policy covered the $2.5 million jury verdict because the clerk’s death was an accident.
     In 1997 a robber abducted Michael Young from a liquor store in Muncie, tied him to a tree at a nearby park and beat him to death.
     The store’s alarm company, Tri-Etch, should have noticed that Young had not armed the store’s alarm at midnight and notified the manager.
     The failure was not discovered until the next morning, when Young was found tied to the tree and barely alive. He died that day.
     In 2004 a jury found that Tri-Etch had failed to notify the store manager within 30 minutes of closing that the night alarm had not been set. Had the company performed its duties properly, the jury said, Young would likely still be alive.
     When it came time to collect the award from Tri-Etch’s $3 million policy with Cincinnati Insurance Company, the company denied the claim, saying that the policy covered bodily injury only in an “occurrence,” which is typically defined as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions.” Young’s death resulted not from such an accident but from an “error and omission” on Tri-Etch’s part, for which the alarm company was not covered, Cincinnati claimed.
     A trial court ruled that Young’s death was an accident and therefore covered, and the Indiana Court of Appeals agreed. The Indiana Supreme Sourt reversed.
     “Tri-Etch’s failure was just such an “error and omission,” not an “accident,” and for that reason it is not an “occurrence” covered by Cincinnati’s … policies,” Justice Theodore Boehm wrote in a unanimous decision. “To the extent Tri-Etch had a duty to Young, it arose from its contract with Young’s employer. This may give rise to tort liability. But it does not convert a failure to meet a standard of care under a contractually assumed duty into an ‘accident.'”
     James Fisher and Debra Miller represented Tri-Etch and Young’s family. Richard Skiles and Janet Prather represented Cincinnati Insurance Company.

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