The Blue Lady by Mary H. Foster

Recently bereaved Kate is trying to come to terms with the loss of her much loved husband.
Her healing is hampered by a recurring dream of a young woman wearing a blue satin cloak. There is nothing terrible about the dream but she always wakes from it in a state of terrified horror. The dream is bound up with the square in London where she spent her childhood and it is on a visit to this square that she meets an elderly lady with whom she immediately forms a rapport.
As their friendship progresses, Kate finds herself becoming happier and more confident of her future and finds her talent as an artist has returned.
The first picture she completes is a portrait of the blue lady of her dreams and she feels confident that she has exorcised the troublesome young woman.
Kate then experiences several near fatal 'accidents', and during one of them meets James, who had suffered a traumatic event of his own.
Things then take a horrifying turn for the worse and both of them find themselves fighting for their lives.