Until 1991 it was possible to collect homeowner’s insurance coverage for the damages suffered by molested children. The legal basis was the 1979 decision in Congregation Rodef Shalom v. American Motorists 91 Cal. App. 3d 690 which held that a teenager who set a fire that damaged a synagogue was unable to conduct himself in accordance with reason and his family’s homeowner’s coverage had to pay the bill. From that decision it was a short step to establish that a pedophile was unable to conduct himself in accordance with reason. Following that rationale molester, does not act willfully and the molester’s homeowner’s insurance would be obligated to satisfy the child’s claim for damages. The well-recognized rule precluding insurance coverage for willful acts, as explained in more detail below, did not apply, because the act was not intentional but rather the result of a mental condition.
Following Rodef Shalom, plaintiffs’ lawyers were encouraged by the author in legal seminars to take on the representation of children and protocols were provided to help insulate a child from further harm by taking action to collect for the damage inflicted. The insurance defense bar was supportive of procedures to avoid further harm to children in civil actions and claims were concluded under court approval, holding a child’s recovery in trust for their benefit.
The insurance industry response to Rodef Shalom was to re-write homeowner’s policies to exclude coverage for sexual crimes and misconduct, as well as excluding any obligation to pay damages arising from molestation and abuse.
In 1991 the California Supreme Court in a 6 to 1 decision ruled that a homeowner’s insurance policy was not obligated to pay for molestation injuries caused by a policyholder. J. C. Penny Insurance v. M. K. 52 Cal. 3d 1014. That ended homeowner insurance liability in molestation cases. For that reason, today the number of children that are successful in collecting compensation for the psychological harm caused by molestation has diminished to a trickle.
Today the only hope for a survivor of molestation to collect compensation for mental injury, dehumanization, and emotional pain is to prove that a third party was negligent in hiring or supervising a child molester. As a result child molestation lawsuits are commonly brought against school districts, Boy Scout leaders, athletic coaches, camp owners and supervisors, and church officials and in rare cases the child molester with substantial assets.
Although California’s criminal justice system claims it provides rights to the victim’s of crime, as a practical matter California’s criminal restitution laws requiring convicted felons to pay for medical expenses and lost earnings suffered by a victim of crime are meaningless. Restitution damages are uncollectible and they do not include consideration of the victim’s pain and suffering.
Below are the common and usual insurance industry defenses whenever a claim of sexual abuse is tendered to an insurance carrier.
The following has been culled from denial of coverage letters issued by carriers and is provided for a general view of insurance industry defenses that is not endorsed or supported by the author.
Common Insurance Industry Defenses to Child Molestation Claims
Child Molestation is not an accident.
There is no insurance coverage for child molestation because homeowner policies only cover “accidents.” Carriers only will pay damages for which an insured person becomes legally obligated to pay because of bodily injury or property damage arising from an occurrence to which this policy applies. An “occurrence” is an accident, including continuous or repeated exposure to substantially the same general harmful conditions during the policy period, resulting in bodily injury or property damage.
Where a policy defines “occurrence” the term in effect means “accident.” Collins v. Am. Empire Ins. Co., 21 Cal. App. 4th 787, 805 (1994). Accordingly, homeowner policies only cover liability resulting from an “accidental” event.
The California Supreme Court has defined “accident” as “an unexpected, unforeseen, or undesigned happening or consequence from either a known or unknown cause.” Hogan v. Midland Nat’l Ins. Co., 3 Cal. 3d 553, 559 (1970). Stated differently, it is “something out of the usual course of events . . . which happens suddenly and unexpectedly and without design.” State Farm Fire & Cas. Co. v. Drasin, 152 Cal. App. 3d 864, 865 (1984).
Deliberate conduct is not “accidental.” Royal Globe Ins. Co. v. Whitaker, 181 Cal. App. 3d 532, 537 (1986).
Further, an insured homeowner who engages in deliberate conduct cannot claim an “accident” on the ground he did not expect or intend cause any harm. See Merced Mut. Ins. Co v. Mendez, 213 Cal. App. 3d 31, 50 (1989) (“where the insured intended all of the acts that resulted in the victim’s injury, the event may not be deemed an “accident” merely because the insured did not intend to cause injury.”); Ray v. Valley Forges Ins. Co., 77 Cal. App. 4th 1039, 1045-46 (1999) (“The plain meaning of the word ‘accident’ is an event occurring unexpectedly or by chance.”); Allstate Ins. Co. v. Tankovich, 776 F. Supp. 1394, 1396 (N.D. Cal. 1991) (repeated instances of racially motivated conduct, “despite the lack of a subjective intent to cause injury, cannot be deemed accidental.”); Am. Guar. & Liab. Ins. Co. v. Vista Med. Supply, 699 F. Supp. 787, 791 (N.D. Cal. 1988) (“Where the act giving rise to damages was intentional, the California courts have rejected the argument that while the act was intentional, the damages were not, and thus should be covered under the policy.”).
As a result, physical assaults are not “accidents,” irrespective of what motivates them. See State Farm Gen Ins. Co. v. Frake, 197 Cal. App. 4th 568, 580-81 (2011) (insured’s deliberate act of striking his friend as part of a consensual game did not constitute an “accident,” even if he did not intend to injure); Delgado v. Inter. Exch. of the Auto. Club of So. Cal., 47 Cal. 4th 302, 312 (2009) (assault and battery not “accidental,” even if insured was acting in self-defense); Blue Ridge Ins. Co. v. Stanewich, 142 F.2d 1145, 1148-49 (9th Cir. 1998) (insured did not accidentally enter home and attack occupants); David v. Allstate Ins. Co., 2014 U.S. Dist LEXIS 119473 (C.D. Cal. 20 14) (allegations of assault, even if in self-defense or false, did not allege an “accident”); Nakauchi v. Allstate Ins. Co., 2002 U.S. Dist. LEXIS 26055 (C.D. Cal. 2002) (“The acts of striking and beating someone about her head and body. . . are necessarily not accidental, regardless of the insured’s subjective intent”); see also Collin, 21 Cal. App. 4th at 811 (“conscious and deliberate actions of an insured are never an ‘accident,’ irrespective of whether the insured intends for harm to result from those actions.”).
Sexual assault cannot be an “accident” as a matter of law, even if the insured mistakenly believed the plaintiff consented to the sexual act. See Mendez, 213 Cal. App. 3d at 41 (insured’s act of engaging in sexual activity with co-worker was not an “accident” regardless of whether insured had a reasonable belief that co-worker consented to his sexual advances).
Quan v. Truck Ins. Exchange, 67 Cal. App. 4th at 599-601 (1998) held that sexual assault, consisting of touching, embracing, kissing and sexual intercourse, were deliberate acts, regardless of whether any harm was intended or expected to come of them and therefore cannot be “accidental”. See also Gonzalez v. Fire Ins. Exch., 234 Cal. App. 4th 1220 (2015) (no “accident” at issue where insureds allegedly forced claimant to become inebriated and then engaged in nonconsensual sex with her).
In Baek v. Cont. Gas. Co., 230 Cal. App. 4th 356, 370 (2014) the court stated: “One does not ‘accidentally’ sexually fondle another[.)”); in accord is Shanahan v. State Farm Gen. Ins. Co., 193 Cal. App. 4th 780, 7888-89 (2011) (insured did not “accidentally” squeeze claimant’s buttocks, make sexual overtures, and suggest she leave her husband); Lyons v. Fire Ins. Exch., 161 Cal. App. 4th 880, 889 (2008) (insured did not “accidentally” grab plaintiff, expose himself, and try to perform a sexual act and his misimpression that the plaintiff would not rebuff his sexual advances and would consent “simply cannot transform his intentional conduct, done with full knowledge of all the objective facts, into an accident.”).
Northland Ins. Co. v. Briones, 81 Cal. App. 4th 796 (2000) the court found alleged acts of rape, stalking and sexual harassment cannot be considered “accidental.”
See the identical results in Allstate Ins. Co. v. Talbot, 690 F. Supp. 886, 889-90 (N.D. Cal. 1988) (“[a]lthough the molester in this case has raised the defense that the conduct . . . may not have been intentional, he has not completely strained his credibility with an assertion that the conduct was ‘accidental”‘); Amica Mut. Ins. Co. v. Fischer, 2008 U.S. Dist. LEXIS 36596 (E.D. Cal. 2008) (sexual assault in hazing ritual was not “accidental”); Susan B. v. Chicago Ins. Co., 2007 Cal. App. Unpub. LEXIS 4149 (Ct. App. Ca., May 23 , 2007) (where teacher sexually harassed students, he acted volitionally and his intent could not change the nature of his conduct); Ananda Church of Self-Realization v. State Farm Fire & Gas. Co., 2003 Cal. App. Unpub. LEXIS 1082 (January 31, 2003) (sexual harassment and assault were acts performed exactly as intended, whether or not there was any intention to harm).
Defense of Losses Not Covered
In California insurance companies do not cover any bodily injury or property damage intended by, or which may reasonably be expected to result from the intentional or criminal acts or omissions of, any insured person. This exclusion applies even if the insured person lacks the mental capacity to govern his or her conduct; the injury is of a different kind or degree than intended or reasonably expected; or bodily injury or property damage is sustained by a different person than intended or reasonably expected.
Under California law, an injury is “expected” if it is substantially certain to result from the insured’s intentional act, even if the insured may not subjectively wish or intend to cause that result. See Shell Oil Co. v. Winterthur Swiss Ins. Co., 12 Cal. App. 4th 715, 743-748 (1993); Allstate Ins. Co. v. Tankovich, 776 F. Supp. 1394, 1398-99 (N.D. Cal. 1991); Zelda, Inc. v. Northland Ins. Co., 56 Cal. App. 4th 1252, 1260-61 (1997) (applying “expected or intended” exclusion where insured’s employee grabbed a patron and threw him to the ground). The insured’s conduct is judged from the perspective of an objectively reasonable person, not from the insured’s actual, subjective perspective. Castro v. Allstate Ins. Co., 855 F. Supp. 1152, 1154 (S. D. Cal. 1994) (finding the policy contains a “wholesale exclusion of coverage for injury or damage arising out of any criminal [act]”); Allstate Ins. Co. v. Talbot, 690 F. Supp. 886, 888-89 (N.D. Cal. 1988) (recognizing exclusion requires no subjective intent to harm; focus is on expectation of a reasonable person); Scott v. Allstate lndem. Co., 417 F. Supp. 2d 929, 936 (N.D. Ohio 2006) (“The phrase which may reasonably be expected to result’ denotes an objective as opposed to subjective standard of coverage rendering an insured’s subjective intent to cause damage irrelevant.”).
In addition, these common exclusions eliminate coverage for criminal acts, such as sexual assault and battery, whether or not a molester intended to cause harm or were charged with a crime. See Century-Nat’I Ins. Co. v. Glenn, 86 Cal. App. 4th 1392, 1397 (2001); 20th Century Ins. Co. v. Stewart, 63 Cal. App. 4th 1333, 1338 (1998). Sexual molestation of a child constitutes a violation of Penal Code section 288a, among many other statutes, and is one of the most heinous of all serious felonies.
Public Policy Defense – No Coverage for Willful Misconduct
Section 533 of the California Insurance Code provides that an insurer is not liable for the “willful” act of its policyholder. A “willful” act is one that is committed with an actual intent to harm or that is inherently harmful, and is unaccompanied by a justification, such as self-defense. Assault and battery constitute “willful” misconduct that is uninsurable under Insurance Code section 533. Fire Ins. Exch. v. Altieri, 235 Cal. App. 3d 1352 (1991) (no coverage where insured and a friend, without apparent provocation, attacked a schoolmate walking on a sidewalk by punching him in the face); lnlerins. Exch. of Auto. Club of So. Cal. v. Flores, 45 Cal. App. 4th 661, 673 (1996) (no coverage where insured and friend shot claimant from moving car); Western Mut. Ins. Co. v. Yamamoto, 29 Cal. App. 4th 1474, 1486 (1994) (no coverage where insured shot another youth after long-running argument).
In J.C. Penney Ins. Co. v. M.K., 52 Cal. 3d 1009, 1025 (1991), the California Supreme Court held that a sexual assault upon a child “inherently harmful” and thus uninsurable. Other courts considering the insurability of sexual battery claims have reached the same conclusion. See Allstate Ins. Co. v. Talbot, 690 F. Supp. 886, 890 (N.D. Cal. 1988) (“Indemnity for acts which constitute a violation of Penal Code Section 288(a) is precluded under California Insurance Code Section 533”); Allstate Ins. Co. v. Gilbert, 852 F.2d 449, 452 (9th Cir. 1988) (intent can be inferred as a matter of law from a violation of Penal Code Section 288); Am. State Ins. Co. v. Barbor, 826 F.2d 888, 891 (9th Cir. 1987) (“It is beyond cavil that (the insured’s] violations of California Penal Code section 288 are willful acts within the ambit of Section 533”); State Farm Fire & Gas. Co. v. Ezrin, 764 F. Supp. 153, 156-57 (N.D. Cal. 1991) (nonconsensual sexual assault is a wrongful act that is precluded from coverage under section 533).