Even though the Legislature legalized concealed weapons in 1996 and open carry in 2015, there is nothing new about a business owner keeping weapons under the store counter or in the vehicle used to take deposits to the bank. The laws, however, raise questions about liability insurance for weapons-related incidents, so it’s a good time to brush up on coverage issues.
There are at least three ways an insured can injure someone with a weapon:
Accidental discharge of the weapon,
Intentional shooting with an intent to injure the person (shooting a criminal), or
Intentional shooting with accidental consequences (shooting an innocent person standing behind the criminal).
There’s no coverage problem with the accidental discharge. The commercial general liability policy covers the insured’s legal responsibility for bodily injury or property damage to others as the result of an accident. Costs for defense and payment of any subsequent judgment or settlement are provided.
For the other two types of incidents, however, the intentional acts exclusion in the policy presents a problem for the individual or commercial insured seeking defense or indemnity following a shooting incident.
The intentional acts exclusion in the CGL policy reads as follows:
This insurance does not apply to:
a. Expected or Intended Injury
“Bodily injury” or “property damage” expected or intended from the standpoint of the insured.
This exclusion does not apply to “bodily injury” resulting from the use of reasonable force by an “insured” to protect persons or property.
Most courts have treated this exclusion narrowly, so that not only must the action which causes the damage be intentional (striking a difficult customer), but the damages must be reasonably expected (broken jaw vs. paralysis). In an auto-related case (Tanner vs. Nationwide), the Texas Supreme Court said a similar exclusion in the personal auto policy is “effect-focused and cause-focused, voiding coverage when the resulting injury was intentional, not merely when the insured’s conduct was intentional.” According to the decision, if the exclusion were to preclude coverage for reckless acts that didn’t result in deliberate injury, insurance coverage would disappear for many accidents.
The exclusion applies to “the insured” who intentionally causes the damage, and not to all insureds who may be sued as a result of the damages. Thus, the named insured business would be protected in a suit brought by a customer who was intentionally injured by a third party or an employee of the insured.
The exception to the exclusion applies to bodily injury only, and permits the use of “reasonable force” by the insured to protect persons or property, such as when a store owner grabs a customer suspected of shoplifting or shoots a burglar or robber, and the customer or criminal later sues the insured as a result.