Thursday, October 06, 2005

Business Times (5 Oct 2005) - Personal accident policy may cover dengue fever: lawyers

Published October 5, 2005

Personal accident policy may cover dengue fever: lawyers

They cite English case law - but most insurers disagree


(SINGAPORE) Amidst the spate of dengue cases in recent weeks, a debate has arisen in insurance industry circles over whether people with personal accident policies are covered against the disease.

Lawyers and industry watchers that BT spoke with said that in a dispute between a policyholder and an insurer, the policyholder could possibly win. Their opinions were based on legal arguments and English case law.

A check with some of Singapore's largest insurers found that at least one, AIA, has a personal accident policy that does provide hospital income benefit for those hospitalised with dengue fever, but that most policies do not.

'Lawyers having looked at the question think, on balance, dengue would be covered,' said Singapore Insurance Institute (SII) president Stanley Jeremiah. 'But, of course, there is no test case yet in Singapore.' Mr Jeremiah, who is a lawyer, said that whether contracting dengue was covered under a personal accident policy depended on the policy's wording.

'The main issue revolves around the definition of an accident which is usually 'violent, external and visible means',' Mr Jeremiah said. 'But the legal argument is that 'violent' simply means the opposite of 'natural' - so the considered view, is that, yes, (contracting dengue from a mosquito bite) will be covered.'

He said there was English case law dating back to the 19th century which had showed that the definition of 'violent' need not include the use of force.

'There are quite clearly cases that support this view,' he said. 'Based on contracts and law, it would seem the insured would have a valid claim for dengue as falling under accident policies.'
Adeline Chong, a partner at Harry Elias Partnership specialising in insurance law, agreed that being bitten by a mosquito and contracting dengue could be construed as an accident under legal terms.

'I haven't seen a case like this yet, but it would be interesting to see how a local court rules,' she said. 'Off the top of my head, I think that these policies might cover dengue . . . but still, at the end of the day, we have to look at how the underwriters determine their scope of cover.'
A check with some of Singapore's largest insurers reveals that they believe that most personal accident policies do not cover dengue fever.

A spokeswoman for NTUC Income, the largest insurer in Singapore in terms of policyholders, said that dengue fever was covered under the company's infectious disease plan, but not its personal accident policies.

'The personal accident plan under NTUC Income covers a person against death and bodily injury caused by violent accidental external and visible means . . . (but) dengue fever is not covered under the plan,' she said. 'However, we will look at the circumstances leading to the person contracting the dengue fever. Where appropriate, we may make a payment to help a policyholder.'

The company did not indicate if it had ever made a payment on a claim like this, but did say that fewer than 10 claims were made a year.

Aviva declined to comment, while Prudential said that their policies did not cover the disease, although AIA said that one of its personal accident policies did.

'Our personal accident plan, AIA Personal Accident 24-Hour Plan, has a hospital income benefit which is payable when the insured is hospitalised due to an injury or illness, including dengue fever,' a spokeswoman of the company said, adding that the company had paid out for dengue claims recently.

According to the company, in the event that an accident or illness causes a policy holder to be confined in hospital, a daily hospital income benefit will be paid up to the maximum of 500 days, and hospital expenses reimbursed up to a maximum of five times the daily in-hospital income or $300, whichever is less, for the same illness or injury.

However, Mr Jeremiah said that a hospital income benefit was a 'given', as it would be payable to anyone who was hospitalised, regardless of why.

He added that if a person were to die from dengue fever, it would be covered by most life insurance policies, but it was unlikely to be covered under critical-illness policies.

'I think this issue is not something that insurers have thought about,' he said. 'But as far as the insured party is concerned, he clearly will view it as an accident, while the insurers are unlikely to do so.'

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