MASS SHOOTINGS: MULTIPLE CLAIMANT CONSIDERATIONS -
In 2020, despite nearly nationwide lockdowns due to the COVID-19 pandemic, the United States sustained 611 mass shooting events. This represents an increase from 336 in 2018 to 417 in 2019. Such events often lead to civil liability claims by multiple claimants seeking significant sums. For instance, in the MGM Las Vegas shooting 58 people were killed and another 850 injured. The claims were settled for $800 million, with insurers contributing $751 million. The increased exposure has resulted in coverage litigation and the sale of alternative “deadly weapon” or “active shooter” coverage options, frequently as standalone policies. However, assuming coverage exists, whether under a CGL policy or newer Active Shooter insurance, the number of claimants and accompanying high exposure of mass shooting claims present unique challenges for the insurance industry. Carriers must frequently determine the amount of available limits and navigate settlement with multiple distinct claimants, while avoiding extracontractual liability.
Determining available limits frequently centers on whether the covered events are considered one occurrence under the policy or multiple occurrences. Under an occurrence-based policy, limits are frequently available per occurrence within an aggregate limit for multiple occurrences. Under such circumstances, where each shooting victim or round fired is considered a single occurrence, the claimants would stack occurrences until the aggregate limit is reached – creating a ceiling to potential exposure. However, if the applicable policy fails to proscribe an aggregate limit, the number of occurrences is not artificially limited, and the potential exposure remains unchecked. Alternatively, where the shooting event is considered a single occurrence, the per occurrence limit greatly reduces carrier exposure...
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