Jury Finds Drug Use Not Direct Cause of Spinal Injury, Insurer Must Pay $1 Million

A federal jury in Houston has made a significant ruling that Occidental Fire & Casualty Co. of North Carolina must pay $1 million under a homeowner’s policy for a claim initially contested due to a controlled-substance exclusion. The case centered around Christoffer Cox, a former high school gymnast who suffered a catastrophic spinal injury after falling from a bed while under the influence of LSD at a friend’s house in Texas in 2019. The insurer, Occidental, sought to deny coverage, arguing that the injury resulted from the use of a controlled substance. However, the jury found that the direct cause of the injury was not the LSD ingestion but possibly the negligent handling of Cox after the fall.

The policy issued by Occidental to homeowners Dirk and Andrea Zinkweg included a liability coverage clause and an exclusion for incidents arising from the use of controlled substances like LSD. Despite this, the jury’s decision underscores the importance of the specific circumstances leading to an injury in determining insurance coverage, rather than the mere presence of controlled substances. The case highlights the complexities involved in insurance claims related to drug use and injuries, particularly regarding policy exclusions and the interpretation of direct causation.

This verdict could have implications for future insurance claims involving controlled substances, emphasizing the need for clear evidence of causation rather than assumptions based on drug involvement. It also reinforces the insurer’s duty to defend policyholders in claims, even when exclusions are cited. Occidental Fire & Casualty, a subsidiary of IAT Insurance Group, faces a significant payout, reflecting the jury’s interpretation of policy language and causation in the context of drug use and injuries.