Decisions, Decisions – Keeping Casualty Carriers Clued In
From sexual molestation to social host, ridesharing, dog bites and even backyard zip lining, our most recent Casualty Matters examined a range of important court cases that could be relevant to personal and commercial lines underwriters.
Take the Pennsylvania Supreme Court decision that puts latent disease claims in the scope of employers’ liability. The Tooey case involved asbestos exposure and mesothelioma that manifested after the statutory 300-week period for filing Workers’ Compensation claims after employment. The time limit for Occupational Disease claims in the WC system creates an exposure under the employers’ liability policy so insurers should now be aware of that potential.
Ridesharing is a growing trend that personal lines insurers would do well to watch because the legislative picture around coverage changes almost daily. Insurers should anticipate every state getting involved, though it is unclear what new laws and obligations will emerge that will impact personal auto.
Another topic, social host liability is a vexed issue at the best of times – but what happens when a host charges an entry fee to all guests? Answer: the host can be liable under the dram shop statute. As seen in a recent case, California does not recognize social host liability, so this ruling could be significant for finding a path to liability there. In an Illinois case involving a cheerleading school, an employee was accused of sexually abusing a student and both parties were sued. An endorsement to the policy excluded abuse and molestation, including negligent employment, and then provided a sublimit of $100,000 for defense cost reimbursement.
The policyholder argued that a difference in language created ambiguity - the exclusion applied to abuse by anyone of any person, while the coverage buyback excluded abuse by any insured of any person. But the court found no inconsistency and the case confirmed to insurers of youth groups, churches, camps and day care centers that exclusions are working as intended.
Read our last Casualty Matters publication for more on issues affecting casualty carriers.