A vehicle hit the cyclist in California, resulting in significant costs for the Yukon government
In a recent decision, the Yukon Supreme Court ruled that the government of Yukon could not recover healthcare costs from Security National Insurance for medical care provided to Christopher Boughner after his accident in California.
Boughner was cycling in La Quinta, California when he was struck by a vehicle. The driver, who was at fault, had third-party liability coverage amounting to $25,000 USD. Due to the accident, Boughner required hospitalization and medical care both in California and back in Yukon, incurring significant costs for the Yukon government.
At the time of the accident, Boughner was insured by Security National under a policy that included a Family Protection Endorsement (SEF 44). This endorsement provided that Security National would indemnify Boughner for compensatory damages from an under-insured motorist up to the policy limit.
Yukon argued that it had the right to recover the healthcare and medical travel costs from Security National as an eligible claimant under SEF 44. The government based its claim on the Yukon statutes: the Health Care Insurance Plan Act, the Travel for Medical Treatment Act, and the Hospital Insurance Services Act. According to Yukon, these statutes allowed it to be subrogated to all rights of Boughner for recovering costs due to injuries from another's wrongful act.
The Supreme Court concluded that neither Boughner nor the Yukon government could recover these costs from Security National under the SEF 44 coverage. The court examined the relevant statutory provisions and the insurance policy terms. The court found that that the statutory right of recovery allowed claims only against the wrongdoer or their insurer, not the victim's insurance. Yukon's right of subrogation did not extend to Boughner’s insurance, as the statutes limited recovery to the responsible party.
Furthermore, the court noted that the definition of "eligible claimant" under SEF 44 coverage did not include government entities, as it was intended to protect natural persons and their families, not governmental bodies
The decision also highlighted that allowing Yukon to claim against Boughner’s SEF 44 coverage would potentially reduce Boughner’s recovery, as SEF 44 coverage is intended as a "last ditch" protection for the insured person’s own shortfall in compensation from an under-insured motorist. Ultimately, the Supreme Court ruled that Yukon could not recover healthcare and travel costs from Security National under Boughner’s SEF 44 policy.
