The Limits of Wrongful Death: Serious Claims Require Serious Considerations of Applicable Policy Limits

Author: Daniel Fallon

Life is precious. When it is lost prematurely, the grief and anger of the decedent’s family and loved ones can be immeasurable. They often turn to the legal system to measure their loss by way of a wrongful death lawsuit against the individual or corporate entity believed to be at fault for the unfortunate situation. When those defendants are fortunate enough to be covered by insurance, the handling attorneys and claim professionals must give serious consideration to the policy limits applicable to the situation in order to reach a reasonable and final resolution to the matter.

Liability insurance policies typically set forth limits on the coverage provided for injuries to third persons, including third persons asserting wrongful death claims related to the death of a family member. Oftentimes, the policy makes a distinction between the available limits with respect to a “per person” basis and a “per occurrence” basis. If there are multiple claimants arising from a single occurrence, the amount of policy proceeds available to satisfy all of the claims is determined by the “per occurrence” basis, while each individual claimant is limited on the “per person” basis.

So, which limit applies to the situation in which multiple heirs are making wrongful death claims for the loss of a single individual? Because the “per person” limits are typically much less, and usually half, of the “per occurrence” limits, claimants and their counsel understandingly push for application of “per occurrence” limits to their benefit. There are multiple claimants, so this should bring the matter into the “per occurrence” basis rather than just “per person.” Right? Serious claims require serious consideration of this issue and mishandling of the applicable limits can be disastrous for the defense.

Guidance on this issue can be found in the authority of United Services Automobile Ass’n v. Lilly (1990) 217 Cal.App.3d 1396. In this wrongful death matter, USAA’s insured caused an automobile accident in which a man was injured and his wife was killed. The man filed a personal injury action and the heirs filed a wrongful death action against the at-fault driver. The subject policy provided bodily injury liability limits of $100,000 per person and $300,000 per occurrence. As would be expected, the claimants alleged they were entitled to the $300,000 limits, so USAA filed a declaratory relief action to resolve the dispute.

In considering the matter, the Court noted, “USAA contracted with the insured to ‘pay damages for bodily injury…for which any covered person becomes legally responsible because of an auto accident.’” Id. at pg. 1399. Although the policy did not “explicitly cover wrongful death,” application of standard rules of contract construction led to the conclusion the policy covered wrongful death claims within the meaning of “bodily injury.” Id. at pg. 1400.

The heirs then argued each of them sustained “bodily injury” from the incident in light of their ability to bring a wrongful death action under Code of Civil Procedure Section 377 based upon their own independent “pecuniary loss” arising from the death of their relative. Accordingly, they believed the greater “per occurrence” limits should apply. Id. at pg. 1402.

The Court focused on the policy language limiting coverage to “damages for bodily injury [i.e. death] sustained by any one person in any one auto accident.” Because the person injured in the accident was the decedent, recovery under the policy for damages resulting from the death is limited to the “per person” basis. Id. Accordingly, the heirs were only entitled to recovery within the $100,000 per person limits, rather than the more substantial $300,000 per occurrence limits.

When a serious wrongful death claim comes through your door, give serious consideration to the available limits based upon the language of the policy. Read the policy in light of the claims and relevant legal authority. It is the best, and indeed only, way to ensure a just resolution of an unfortunate situation and can help avoid significant overpayment of a claim. Life is precious, and its loss must be dealt with properly and fairly within our legal system to ensure it is protected.

Mr. Fallon specializes in civil litigation in the areas of professional liability. He has significant experience executing litigation strategies to the benefit of his individual and corporate clients. Contact Dan at 858.263.4132 or

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