A few weeks ago, we looked at a soured marriage from the perspective of auto insurance. This time, we look at the same subject but from the homeowners insurance side of the coin...
Question from an IIABNY member: Here's the scenerio: Person A sends an e-mail to Person B about Person C. Both Person A and C know Person B as they used to be married. Person B is their son's baseball coach. In the e-mail, Person A basically bashes Person C to Person B and also tells Person B a lot of personal details about Person C's life that B has no reason to know. This embarrases and upsets Person C very much. Does Person C have a case for personal injury for slander and damage to reputation against Person A's homeowners policy? There also have been phone conversations between Persons A and B where A has been badmouthing C as well.
Answer: So, if I understand correctly, A and C are former spouses; B is the baseball coach who is officially sorry he gave out his e-mail address. A (to be non-sexist, I’ll say that A is the ex-husband) writes to B, spilling his ex-wife’s intimate secrets and badmouthing her. In addition, he has called B (who is now looking into changing cell phone numbers) with lots more in the TMI department.
I’ll assume Mr. A has the equivalent of an ISO HO-3 policy. Coverage E — Personal Liability covers the insured for his liability for bodily injury or property damage; since C has suffered emotional distress but no apparent bodily injury, there’s no coverage in the unendorsed policy. The countrywide ISO endorsement for personal injury liability is HO 24 82, but New York has a state-specific version, HO 24 86 10 02, Personal Injury – New York. It provides indemnity and defense if a claim is made or suit brought against an insured for damages resulting from an offense defined under “personal injury.” That definition has five parts; parts 4 and 5 are relevant:
“Personal injury” means injury arising out of one or more of the following offenses, but only if the offense was committed during the policy period:…
4. Oral or written publication of material that slanders or libels a person or organization or disparages a person’s or organization’s goods, products or services; or
5. Oral or written publication of material that violates a person’s right of privacy.
Mr. A’s actions appear to meet both of these definitions – his oral and written statements allegedly slandered and libeled his ex-wife and violated her privacy. However, the exclusions take away coverage:
a. If he knew that his statements would violate her rights and inflict personal injury
b. If he knew what he was saying was false
c. If he made the statements before the policy took effect
These exclusions go to his state of mind: Did he make this stuff up entirely or just distort something that was true? Did he intend to air her dirty laundry and get under her skin, or did he think he was blowing off steam to someone who would not relay it back to her? I expect that, if he has this endorsement, his insurer will provide him with at least an initial defense until they can conclusively prove that one or more of the exclusions apply.
Interestingly, according to the IRMI Personal Risk Management and Insurance manual, most personal umbrellas automatically include coverage for personal injury, so even if he doesn’t have the endorsement on his Homeowners policy, he might be covered (after application of the deductible) if he has an umbrella. You probably have no way of knowing whether or not he has the coverage unless he shows her his policies (seems unlikely given their high regard for each other) or she sues him. Since they are no longer married, she has no legal right to this information from his insurance agent. New York Insurance Regulation 169 requires the agent to share his information with unaffiliated third parties only in compliance with the agent’s privacy policy; I doubt that the policy says the agency will share information with estranged spouses.
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