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Chubb, Hudson Upheld in Denying Insurance to Couple Accused of Delaying Son’s Murder Case

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Pennsylvania parents who are alleged to have found but not turned over to authorities a gun believed used by their son to murder a friend are not entitled to insurance for their defense against emotional distress claims brought by the friend’s mother.

Howard I. Rosenberg and Kimberly L. Rosenberg sought coverage for defense and indemnifications under a home insurance policy issued by Chubb Indemnity and a personal umbrella from Hudson Insurance. Both insurers denied coverage citing the language of their policies that bars coverage for intentional acts. The parents contend their actions should be covered because they did not intend to cause the emotional distress that the mother has alleged.

The federal district court in Western Pennsylvania this week sided with the insurers, calling the parents’ conduct a prime example of actions that are not covered by insurance.

The Rosenbergs are being sued by the mother of the boy their son allegedly killed in their residence and then dragged to a nearby public park to hide the body. The deceased’s mother alleges that the Rosenbergs found a handgun that may have been used in the murder and gave it to their marriage counselor, “in an effort to prevent or delay the arrest and prosecution” of their son as it was likely to be evidence. The marriage counselor then allegedly turned the gun over to the homicide detectives, telling them that she found the handgun rather than revealing that the gun came from the Rosenbergs. The mother maintains their actions resulted in a delay of the police investigation and discovery of her son’s decayed remains. She is suing for intentional infliction of emotional distress.

The Rosenbergs contend that Chubb and Hudson should have provided coverage despite the possibility that the underlying case against them may become moot, depending upon the disposition of the appeal.

Chubb denied coverage under a Masterpiece homeowner’s liability policy because it said the factual allegations asserted against the Rosenbergs do not constitute personal injury caused by an “occurrence” as required. “This conclusion follows because the acts you are accused of committing are intentional and not accidental or fortuitous,” the insurer informed the Rosenbergs.

The court agreed with Chubb. The factual allegations in the deceased’s mother’ complaint, the language of the policy, and the case law regarding “occurrence” and “accident” lead to the “inevitable conclusion that the personal injury the mother suffered by was not caused by any occurrence under the Chubb policy,” the court found. The complaint is “rife with factual allegations that cannot be described as fortuitous or accidental” including that the Rosenbergs found the handgun, knew it was likely evidence in the crime, and transferred possession of the gun to their marriage counselor for the purpose of preventing/delaying their son’s arrest and prosecution. As a result of these alleged actions and inactions, the police investigation and discovery of the body were delayed.

All of these alleged actions or inactions demonstrated that the Rosenbergs “acted with the intent to accomplish their particular goal” of preventing and/or delaying their son’s prosecution. “Such alleged conduct presents a straightforward example of actions that do not fit within the realm of accidental,” the court concluded.

The court asserted that the “conclusory allegations of recklessness do not convert the Rosenberg’s actions into occurrences or accidental to trigger coverage in this case.”

Chubb also contended that even if the court found that underlying complaint alleged an “occurrence,” the “intentional acts” exclusion language of the policy would exclude coverage. The court again agreed with the insurer.

The Rosenberg’s Hudson policy was a personal umbrella policy providing excess insurance beyond the existing limits and coverages of other policies, such as a homeowners or auto insurance policy. Hudson’s reasons for denying coverage and the court’s analysis of the Hudson policy generally follow the same path as the Chubb situation, but with a small nuance.

The Rosenbergs, as well as the mother suing them, argued that Hudson’s duty to defend was triggered upon the denial of coverage by Chubb, even though Chubb’s policy limits had not been exhausted. They contend that, where an underlying insurer, in this case Chubb, denies coverage for claims otherwise covered by the umbrella policy, the umbrella policy is required to “drop down” and provide a defense for the Rosenbergs.

However, the court affirmed that its analysis and conclusions under the Chubb policy regarding “occurrence,” “recklessness,” and public policy, apply to the Hudson policy as well. Hudson’s duty to defend would only be triggered by an “occurrence.”


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