Insurance Law

Sexual Abuse Can Be Within the Scope of Professional Liability Coverage

Tapas: Small Dishes of Insurance Coverage News & Notes

For lots of reasons, securing coverage, under a professional liability policy, for sexual abuse, is going to be an uphill battle. But as a Connecticut federal court recently explained, under some scenarios, coverage can attach:

“Lastly, the parties dispute whether the underlying lawsuits properly implicate HPL [Hospital Professional Liability] coverage, or if allegations of sexual abuse are necessarily outside the scope of professional liability insurance. There is certainly not, as PEIC would have it, a bright-line exclusion, because the Connecticut Supreme Court has held that a dentist’s professional liability insurance covered claims that he sexually assaulted a patient after (or while) negligently administering excessive nitrous oxide. See St. Paul Fire & Marine Ins. Co. v. Shernow, 222 Conn. 823, 610 A.2d 1281 (1992), [subscribers can access an enhanced version of this opinion: lexis.com | Lexis Advance]. In that case, the Court held that ‘[w]hen [a] medically negligent procedure is so inextricably intertwined and inseparable from the intentional conduct that serves as the basis for the separate claim of a sexual assault, we join with those jurisdictions that conclude that professional liability policies must, in such instances, extend coverage.’ Id. at 830, 610 A.2d 1281. The underlying claims in this case allege that Dr. Reardon for several decades purported to conduct a child growth study under the auspices of the Hospital, and that the study was at least in large part a ruse to sexually exploit children. They do not allege that a person who happened to be a medical professional abused children on his days off, or even that he opportunistically abused his patients at the Hospital, but rather that he devised a long-term medical study to be carried out under the Hospital’s imprimatur and ostensibly under its professional supervision and that a principal purpose of that study was to find and abuse his victims. The medical study and the sexual abuse could hardly be any more ‘inextricably intertwined.’”

Pacific Employers Ins. Co. v. Travelers Casualty and Surety Co., No. 3:11-924 (D. Conn. Sept. 25, 2015), [subscribers can access an enhanced version of this opinion: lexis.com | Lexis Advance].

Coverage Opinions is a bi-weekly (or more frequently) electronic newsletter reporting or providing commentary on just-issued decisions from courts nationally addressing insurance coverage disputes. Coverage Opinions focuses on decisions that concern numerous issues under commercial general liability and professional liability insurance policies. For more information visit www.coverageopinions.info.

The views expressed herein are solely those of the author and not necessarily those of his firm or its clients. The information contained herein shall not be considered legal advice. You are advised to consult with an attorney concerning how any of the issues addressed herein may apply to your own situation. Coverage Opinions is gluten free but may contain peanut products.

    Randy Maniloff is Counsel at White and Williams, LLP in Philadelphia. He previously served as a firm Partner for seven years and transitioned to a Counsel position to pursue certain writing projects including Coverage Opinions . Nonetheless he still maintains a full-time practice at the firm. Randy concentrates his practice in the representation of insurers in coverage disputes over primary and excess obligations under a host of policies, including commercial general liability and various professional liability policies, such as public official’s, law enforcement, educator’s, media, computer technology, architects and engineers, lawyers, real estate agents, community associations, environmental contractors, Indian tribes and several others. Randy has significant experience in coverage for environmental damage and toxic torts, liquor liability and construction defect, including additional insured and contractual indemnity issues. Randy is co-author of “General Liability Insurance Coverage - Key Issues In Every State” (Oxford University Press, 2nd Edition, 2012). For the past twelve years Randy has published a year-end article that addresses the ten most significant insurance coverage decisions of the year completed.

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