Court Finds ‘Occurrence’ Language Ambiguous, Reviving Church’s Coverage Claim for Abuse Settlement
When one abuser harms multiple victims over several years, does a church’s alleged failure to stop him count as one insurance “occurrence” or many? A new Tenth Circuit decision shows how much can turn on the answer when a church seeks coverage for settlements with the abuser’s victims. Church of Jesus Christ of Latter-Day Saints v. Nat’l Union Fire Ins. Co. of Pittsburgh, PA, 182 F.4th 1278, 1280 (10th Cir. 2026).
From 2007 to 2011, a congregation member sexually abused several children in Martinsburg, West Virginia, after his family moved there from Utah and became active in the local church congregation. The abuser gained access to several victims because his mother, who was president of the church’s local women’s organization, offered him as a babysitter to other church families. Several victims and their families sued the church in West Virginia, alleging the church failed to take reasonable precautions that might have prevented the abuse. The church ultimately settled with the plaintiffs during trial.
After settling, the church sought coverage from two insurers, National Union and ACE. Both insurers denied coverage and the church sued them in federal district court in Utah. The dispute centered on the policies’ definition of an “occurrence” and the retained limits that had to be exceeded before coverage applied. Because no individual settlement exceeded the retained limits, but the settlements would exceed those limits if aggregated, the church argued that its alleged negligence constituted one occurrence while the insurers argued that each separate instance of abuse was a separate occurrence.
The National Union policy defined “occurrence,” in part, as the “continuous or repeated exposure to substantially the same general harmful conditions.” The ACE policy contained the same definition for “occurrence” as National Union, but the ACE definition continued to state that “all such exposure to substantially the same general harmful conditions shall be considered as arising out of the same occurrence, regardless of the frequency or repetition thereof, or the number of claimants.”
The Tenth Circuit reversed the district court’s grant of summary judgment to the insurers. Applying Utah law, the court held that the policies’ definitions of “occurrence” were ambiguous because the church’s interpretation—repeated exposure to the dangerous environment allegedly created by its failures could count as one occurrence—was plausible. The court’s ruling was reinforced by the fact that other courts are divided on the issue. Some have held that an institution’s negligence toward repeated sexual abuse is a single occurrence, while others have held that negligence enabling an abuser to harm different victims at different times amounts to multiple occurrences. Still other courts have held that the definitions of “occurrence” resembling the ones at issue in the case had more than one plausible interpretation.
While the insurers argued the church’s interpretation defied “common sense,” the court reiterated it had to examine the policy language and not common sense. Since the church’s interpretation plausibly fit within the policy definitions of “occurrence,” that is all that mattered. The court noted ambiguous provisions “carry a high price” but that insurers can avoid the high price by clarifying provisions for the benefit of the insurer, the policyholder and the courts. More broadly, the decision underscores the potential significance of “occurrence” in coverage disputes and shows that courts will make carriers bear the consequences of unclear wording.
