C.D.Cal.: SWAT team raid damage to house included in insurance coverage

Plaintiff’s claim against defendant insurance company for failing to pay an insurance claim for damage during a SWAT team raid on his house goes forward. The policy’s exclusionary clauses are overbroad under California law. Heard v. QBE Ins. Corp., 2022 U.S. Dist. LEXIS 187748 (C.D. Cal. Oct. 13, 2022)*:

Therefore, this Court believes it is obligated to consider the breadth of this provision as written. Given the California Supreme Court’s binding determination that an exclusion for “any illegal act committed by or at the direction of an insured” is overbroad—as it could include merely negligent acts—and therefore is invalid as illusory, it follows that the even broader language of Acts or Decisions exclusion in the QBE policy—excluding “any act or failure to act … by any person” is also overbroad. See id. Although QBE indicates that such language is common, other courts have also indicated it may be impermissibly overbroad. See Jussim v. Massachusetts Bay Ins. Co., 33 Mass. App. Ct. 235, 597 N.E.2d 1379, 1382 (1992) (holding that the broad Acts or Decisions exclusion “cannot be taken literally”); see also Mettler v. Safeco Ins. Co. of Am., 2013 U.S. Dist. LEXIS 8622, 2013 WL 231111, at *6 (W.D. Wash. Jan. 22, 2013) (“[T]he provision appears to be overly broad, ambiguous, and irreconcilable with other policy provisions and the very concept of an all-risk insurance policy.”). Taken literally, this exclusion would appear to include legal and illegal acts, intentional and unintentional acts, and even unintentional failures to act. Governing California law would appear to prohibit this.