HOA insurer questions coverage in Trayvon Martin’s death 2

At the time of his death, Trayvon Martin was staying with his father’s girlfriend in a townhouse near Orlando, Florida. He was on his way back from the store, inside the gated townhouse development, when he was shot and killed by a community resident who was also the neighborhood watch coordinator. The case has been controversial from the beginning.

As we discussed in our last post, Martin’s mother, Sybrina Fulton, has filed a claim with the homeowners association’s insurance company; she is asking for damages under the HOA’s liability policy. The insurer is apparently not sure the policy will cover Fulton’s loss, and it has asked a federal court to determine if, in fact, the claim can move forward. Courts are often asked to make a declaratory judgment like this, that is, to give an official opinion of whether the terms of the policy cover the event in question.

If the insurance company prevails, the insurer will have no duty to defend the homeowners association. Fulton’s insurance claim would fail, but she could still file a legal action against the HOA. The declaratory judgment merely takes the insurance coverage off the table; the HOA would pay any damage award by itself.

The policy went into effect after Martin’s death, but that doesn’t mean the claim can’t be covered. Court documents indicate that the policy is a claims-made policy. Coverage does not depend on when the event occurred; rather, it depends on whether the event is reported while the insurance policy is in effect.

So the timeframe is not a problem, but the policy language is. The policy apparently includes an exemption for certain claims, including claims for “bodily injury, sickness, mental anguish, emotional distress, disease or death of any person.” Again according to court documents, the exemption only applies to claims for “Wrongful Employment Practices.” (The capital letters are in the original.)

The coverage may hinge, then, on whether Zimmerman was an employee of the association. It’s an interesting argument — and one we will discuss in our next post.

Source: Orlando Sentinel, “Trayvon Martin family’s HOA insurance claim lands in federal court,” Jeff Weiner, Aug. 6, 2012

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