Businesses purchase expensive CGL coverage in order to prevent — or at the very least, to minimize — the damaging impact of a lawsuit on their continued commercial operations.
For example, a grocery store might purchase CGL insurance so that they are covered if a shelf falls on a customer or if a customer slips-and-falls and injures themselves. In the event of a lawsuit for such injuries, the store would be defended by their insurer (and the damages would be paid out by the insurer).
In reality, however, CGL insurers are always looking for ways to back out of coverage and avoid the hassle and expense required by the insurance policy. There are a number of circumstances under which a CGL insurer need not extend coverage, including situations that involve intentional misconduct.
Disputes surrounding commercial general liability (CGL) insurance coverage can be rather complex, and may confuse first-time claimants. Let’s take a look at the basics of the intentional misconduct exclusion.
Exclusion for Intentional Misconduct
CGL insurance coverage typically excludes the intentional misconduct of the insured, and in fact, it is quite rare for such policies to payout for intentional misconduct. The critical issue in many CGL insurance disputes, then, is whether the conduct of the policyholder qualifies as excluded “intentional misconduct” pursuant to the language of the underlying policy.
Generally speaking, whether conduct is deemed “intentional” for the purposes of a CGL insurance claim depends on whether the damaging event was: 1) expected, or 2) intended by the policyholder.
Intended actions are simple. If the policyholder intentionally punches a customer in anger, for example, then such misconduct was clearly intended and almost certainly not be covered by their CGL insurance.
Expected actions are a bit less straightforward. Though the consequences of the policyholder’s negligent actions are not likely to be “expected,” the consequences of the policyholder’s reckless actions may be expected. For example, if the policyholder allows their delivery drivers to make deliveries while intoxicated, then the insurer would deny a subsequent CGL claim on the basis that the policyholder’s conduct recklessly disregarded the consequences of their actions, and that an injury was to be expected.
Contact an Experienced Miami Insurance Coverage Lawyer for Assistance
Here at Ver Ploeg & Lumpkin, P.A., our attorneys have decades of experience representing the interests of insurance policyholders in a wide range of disputes with their insurers, including those that center around the application of coverage exclusions in commercial general liability policies.
We understand the unique challenges typical of such disputes, and how a wrongful denial can disrupt the policyholder’s ability to run their business and move forward. We work closely with clients so that we develop a deep knowledge of the contours of their insurance dispute, which allows us to work quickly and cost-effectively on their behalf.Share