Bullies and Insurance
In THE Ontario Court of Appeal case of Unifund Assurance Company v. D.E., the Ontario Court of Appeal recently ruled that parents of a school-age bully are not covered for their negligent supervision of their child under their home insurance policy. This means that the parents’ insurance company does not have to defend the court action nor pay any damages awarded against the parents or child.
In this case, a court action was commenced against minors for allegedly bullying a fellow classmate. That classmate alleged that the bullying caused her to suffer physical and psychological injuries. The parents of the bullyers were also sued on the basis of allegedly failing to control their children.
The parents had purchased a comprehensive homeowners’ policy. That policy had liability coverage if their personal actions unintentionally caused bodily injury or property damage.
The insurer alleged that under the policy, certain exclusions applied so that it did not have to defend the court action or cover the claim. In legal terms, the insurer stated that it did not have to defend or indemnify the parents.
Justice MacPherson wrote for the Court of Appeal. In its decision, the Court relied on the three part test set out in another case called Non-Marine Underwriter, Lloyd’s of London v. Scalera: That case dealt with an insurer’s duty to defend and indemnify. The three part test is as follows:
whether the legal allegations against the insured are properly pleaded;
whether any claims are entirely derivative in nature; and
whether any of the properly pleaded non-derivative claims could potentially trigger the insurer’s duty to defend.
The Court found that the parents met the two first parts of the test and the action was squarely grounded in negligence.
The exclusion under the policy relied upon by the insurer were as follows:
failure of any person insured by this policy to take steps to prevent sexual, physical, psychological or emotional abuse, molestation or harassment or corporal punishment.
The Court found that the plaintiff’s allegation that the parents negligently failed to prevent physical abuse or molestation was excluded under the policy.
As a result, the Court declared that Unifund the insurer did not have a duty to defend or indemnify the parents in the court action (lawsuit).
The result is that, as it currently stands, school-age bullies and their parents will not be likely covered under a homeowners’ insurance policy that contains this specific exclusion. Therefore, if the plaintiff succeeds in her court action, the parents will need to pay the damages out of their own pocket.
Our personal injury law firm handles all types of injury cases. If you have been injured in any way due to someone else’s careless acts or omissions, we can help. We offer free consultations and work on a no fee until you win basis.
Marc-Nicholas Quinn, Injury Lawyer and Mediator
QTMG Injury Lawyers