SAN FRANCISCO — Insurance companies must prove that a self-inflicted death was intentional before they can withhold life insurance payments from beneficiaries, the state Supreme Court said Thursday.
The 6-1 ruling weakens a longstanding rule exempting insurance companies from paying benefits in cases of suicide. Dissenting Justice Stanley Mosk said it could prompt insurance companies to hesitate to issue life insurance policies in some instances.
Previously, beneficiaries--in Thursday's case, a wife--had to prove that the death was not suicide, usually by convincing a trial court that the insured person was insane and thus did not understand the ramifications of the act.
In a case out of San Diego, however, the court ruled that in the future, the burden is on the insurance company to prove that a suicide occurred and that the dead person intended to commit the act.
The court drew a distinction between a person who is insane but still understands the implications of the act and one who simply did not understand the implications.
"If the insured did not understand the physical nature and consequence of the act, whether he was sane or insane, then he did not intentionally kill himself," the court said in an opinion by Justice Cruz Reynoso.
Although it weakened the former rule, the court handed insurance companies a partial victory by overruling a 1979 court of appeal decision that said insurance companies must prove a person was sane when the suicide occurred.
Now the question of whether a person was sane or insane is not the key. The key is whether the person had the mental capacity to form intent to commit suicide.
The majority also overturned the order of the trial court (Searle vs. Allstate LA 31703) in favor of Allstate Life Insurance Co. over its refusal to pay Alice M. Searle, wife of a retired Navy radioman who shot himself nine years ago.
The husband, Martin Searle, had taken out a $50,000 policy 10 months earlier and had become depressed over his failing health.
Like nearly all life insurance policies, Allstate's policy said it would not pay if the death was by "suicide, whether sane or insane."
Mosk said the majority's new rule is at best complex. To illustrate his point, he included in his opinion a sentence of more than 120 words that sought to explain the rule enunciated by the majority.
The sentence pointed out that insurance companies must now prove not only that a person committed suicide but that although he might have been insane, he was not so insane as to not realize what he was about to do.
To prove such a point would take much time and would be costly, Mosk argued. He added that based on the ruling, insurance companies may decide to narrow their policies, thus making it harder for beneficiaries of people who die accidentally to collect.
State of Mind
Mosk said he would simply ask whether the death was "self-inflicted or accidental" and not look into the state of mind of the person.
He added that the new rule may cause insurance companies to stop insuring some people. He also criticized the majority for issuing a ruling counter to rulings in the majority of other states.
Chief Justice Rose Elizabeth Bird, in a separate partial dissent, said she would have gone further than the majority. Bird said the beneficiary should be able to claim benefits if the insured person who kills himself is "unable to comprehend the moral consequences or general nature of his act."
In another case, the state Supreme Court refused to reinstate a rape charge against a man accused of tricking a woman into having sex by convincing her that it would cure her of a fatal disease.
None of the justices voted to grant a hearing on the state's appeal of a decision in a state appellate court barring rape charges against Daniel Boro in a San Mateo County case.
Prosecutors said that Boro, posing as a doctor, phoned a woman in South San Francisco in March, 1984, telling her that a blood test showed that she was suffering from a possibly fatal disease. To cure it, he allegedly told her, she needed either a $9,000 surgery or sexual intercourse at a cost of $1,000 with an anonymous "donor" who had been injected with a curative serum. She chose sex.
Conduct Not Rape
The appeals court, in a 2-1 ruling last January, said that Boro could be charged with attempted grand theft for trying to collect $1,000 from the woman for the "cure" but not with rape under the law.
Despite the "heartless cruelty of (Boro's) scheme," his conduct was not rape because the woman "precisely understood the nature of the act," Justice William Newsom said in the majority opinion.