Accidents May No Longer Be Covered Losses

A recent case has just held that intentional conduct, with unintentional results is not covered as an "accidental loss" under an insurance policy. Fire Insurance Exchange v. Superior Court 181 Cal App 4th 388 (2010). This is a big deal, here is why. If you are a contractor or homeowner that built a home on a lot but, inadvertently built a small portion on the neighbor's side of the property line, you have no coverage for the lawsuit when the neighbor sues you for encroachment, nuisance, negligence, or trespass. The reason: you intended to build the house. It does not matter if you unknowingly or accidentally made a mistake on the placement of the home and inadvertently placed a portion of the structure on the neighbor's lot.

Another example of how this will impact regular people. Two kids are playing by the pool, when one kid decides it would be funny to throw his friend in the pool. Unfortunately, he does not throw is friend far enough and his friend hits his head on the side of the pool and suffers a fractured skull. He is sued by his injured friend for negligence to cover the medical costs and he tenders the lawsuit to his homeowner's insurance carrier. The carrier can deny coverage because the boy intended to throw the other boy. It does not matter that he did not intend to hurt his friend.

I am attorney Robert A. von Esch IV. I handle construction defect, real estate, business, and personal injury matters. If you have any questions about this article or any other matter, please do not hesitate to contact me via www.voneschlaw.com.