The Taichung Branch of the Taiwan High Court rendered the 104-Bao-Xian-Shang-14 Civil Decision of January 26, 2016 (hereinafter, the “Decision”), holding that insurance premiums and the considerations of coverage are both determined as a result of a professional actuarial procedure and approved by the competent authority, and only defined risks are assumed by insurers.
According to the facts underlying this Decision, the Appellant obtained from the Appellee the Chunghsing Whole Life Insurance as the master insurance contract with the Chunghsing Accidental Injury and Disability Insurance Rider (hereinafter, the “Disability Insurance Rider at Issue”), which stipulates that the insurance coverage includes the degree of disability set forth in the Labor Insurance Disability Indemnification Schedule within 180 days after the occurrence of the injury accident to the insured. After being medically treated following his injury in the insured accident, the Appellant still suffered from a loss of the perspiration function in 40% of his body. Therefore, the Labor Insurance Bureau awarded Class VI occupational injury and disability benefits on August 21, 2012. The Appellant claimed a monthly disability benefit of NT$20,000 from the Appellee pursuant to the contract, but the claim was rejected by the Appellee. Therefore, the Appellant brought this action.
According to the Decision, insurance premiums and the considerations of insurance coverage are determined as a result of a professional actuarial procedure and approved by the competent authority, and the insurer cannot possibly assume broad and unlimited risks. Only defined risks are assumed by the insurer. With respect to insurance indemnification items under an insurance contract, the scope of insurance indemnification can be determined based on the items and details set by other relevant laws, regulations or administrative directives applicable upon occurrence of the insured accident only when such scope is specifically defined in the contractual clauses and supplemented by indemnification items set by other relevant laws, regulations or administrative directives.
It was further concluded in the Decision that the true intent of the parties when the Disability Insurance Rider at Issue was executed was that the insurance coverage was limited to defined risks. To wit, the insurance coverage only included the Labor Insurance Disability Indemnification Schedule attached to Schedule 2 of the Disability Insurance Rider at Issue. Therefore, although the Council of Labor Affairs subsequently issued a circular to include, on a supplemental basis, physical handicaps such as a loss of skin or perspiration function of the body in the labor insurance disability indemnification items, still the coverage of the Disability Insurance Rider at Issue was not expanded accordingly. Therefore, the appeal was rejected because the Appellant’s assertions were deemed groundless.