We wrote the other day about the trial of a Michigan mother charged with involuntary manslaughter for not taking steps to prevent her son from acquiring a gun and taking it to his school where he killed four people. Yesterday the jury came back with four verdicts of guilty. Ethan Crumley’s father is scheduled to face the same charges next month.
There will undoubtedly be an appeal of the conviction but this writer suspects that while that debate continues, homeowner insurance underwriters may be having some debates of their own.
It may come as no surprise that the goal of people who write homeowners’ insurance in the U.S. is to control risk. Your homeowner’s policy essentially offers you indemnity from lawsuits brought by people who may be injured because of how you keep your property. There are actually two elements of coverage. The first is that your insurer will pay for a lawyer to defend you from lawsuits. The second is that the insurer will pay limited damages for verdicts rendered against you for how you keep your property.
The typical claim is for people who slip and fall or who are scalded when your pasta sauce is spilled onto your guests. But there are lots of ways people can be injured by things you keep at home. And one of those things may be your guns.
Jennifer Crumley has been found criminally liable for Ethan’s conduct. Now, the families of the victims will come forward and sue her for contributing to the deaths of the victims. She really has no defense to the civil lawsuit for money damages. A court has unanimously found her criminally negligent. So, she and her husband will be named as defendants in wrongful death actions. The only real issue is what damages will be awarded for negligence that contributed to four deaths.
Ms. Crumley’s lawyer will tell her to make a claim on her homeowner’s policy. We don’t have access to what insurance coverage she may have nor what the policy says. But almost all policies have exclusions for intentional conduct. Here the matter is complicated by the fact that Ms. Crumley’s conviction is for wanton negligence and/or recklessness in allowing her minor child to keep a weapon in her household. Mr. Crumley has the same problem but he’s not yet been tried or convicted.
In cases like this, insurance companies often take a straddle position. They will agree to provide a lawyer to defend the damage claim. But they also issue a reservation letter stating that they do not agree to pay any damage award. That’s often negotiable because in a case like this there was negligent conduct; it involved a weapon kept in the residence and a child resident there. The injuries were inflicted away from the covered residence but this is a place where the precise language of the policy may determine if there is coverage. Obviously, the personal assets of the Crumleys are fully exposed to tort claims to the extent that the jury award exceeds whatever coverage is available. There are often separate legal fights between the homeowners and their insurers over which losses are insured and which are not.
Insurers are constantly evaluating these things. In theory they could insist that they will not pay damages for a dog bite and thus discourage Americans from owning dogs. But they have probably evaluated what dog bite cases cost on an ongoing basis and decided that they will endure the risk. Not many people die or suffer permanent disability from a pet bite. Firearms are another matter as the Crumley case demonstrates. Four dead leaving victims who are parents, children and spouses. The damages will be enormous and while insurance coverage amounts and identity of the carriers are not part of a wrongful death case, insurers are not anxious to be underwriting risks like this. Their identity may not be revealed in the tort cases, but they will be named parties in the cases where the insured homeowners are suing for coverage.
Insurers will not be driven to change policy provisions based on this single case. But, as we noted in our earlier article the recent data concerning suicide and violence in American households suggest the risks are growing quickly. That’s likely to affect the industry’s approach to this problem moving forward. But Americans who keep weapons in their home must also undertake the same calculus. Ethan Crumley has probably wiped out any wealth his family accumulated that is not protected by ERISA. His parents are likely to receive modest prison sentences and return to society with little more than the clothes on their backs. Suffice to say, the “cost” of gun ownership in America may be changing because insurance carriers don’t aspire to shoulder financial responsibility for weapons in the household. That could come in the form of requirements that guns be kept under lock and key for coverage to apply or with special premium charges to gun owners. Meanwhile gun owners who see that the risk of armed robbery is miniscule probably need to ask: “What are my guns protecting and at what price to my income and assets?”
Forbes has some similar thoughts. https://www.forbes.com/advisor/homeowners-insurance/gun-insurance/
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