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Sexual Abuse of a Child is, by Definition, an Intentional Act\\n\\nGustavo Beltran, Alma Beltran, and child A.B. appealed the district \\ncourt\'s pretrial adjudication of their counterclaims against Farmers \\nInsurance Exchange (Farmers).\\n\\nIn. A.B., Gustavo Beltran, and Alma Beltran v. Agave Health, Inc.; et. \\nal.; Farmers Insurance Exchange, et al., No. A-1-CA-39620, Court of \\nAppeals of New Mexico (August 1, 2023) the Court of Appeals resolved the\\n dispute by considering whether the acts alleged were fortuitous.\\n\\nBACKGROUND\\n\\nThe Appellants sued Manuel and Delfina Preciado (the Preciados) alleging\\n that Manuel sexually abused A.B. and that Delfina negligently failed to\\n supervise A.B. while he was in the Preciados\' foster care service. The \\nPreciados stipulated to the entry of money judgments, and Farmers- which\\n insured the Preciados with a homeowner\'s insurance policy-filed a \\ncomplaint in intervention for declaratory judgment seeking a \\ndetermination of no indemnity coverage under the policy for the claims \\nagainst the Preciados.\\n\\nThe district court granted the summary judgment motion, finding that the\\n insurance policy did not cover the claims based on Manuel\'s intentional\\n conduct.\\n\\nDISCUSSION\\n\\nThe district court granted Farmers\' motion to dismiss for failure to \\nstate a claim pursuant to the finding that Appellants lacked standing to\\n bring their countercomplaint against Farmers and that the acts \\ncomplained of were intentional.\\n\\nThe Court of Appeal concluded that Farmers had a right to refuse the \\ninsurance claim without exposure to a bad faith claim because it \\nsuccessfully challenged the coverage of Appellants\' claim in its motion \\nfor summary judgment. In the order granting summary judgment, the \\ndistrict court found that the policy at issue was "an occurrence policy,\\n which applies, for coverage purposes, only to accident and \\nnon-intentional behavior."\\n\\nThe insurance policy had an unambiguous exclusion to the insurance \\npolicy. The exclusion stated that the policy does not cover "bodily \\ninjury, property damage, or personal injury arising from, during the \\ncourse of or in connection with the actual, alleged, or threatened \\nmolestation, abuse or corporal punishment of any person by anyone, \\nincluding . . . any insured."\\n\\nAny injuries or damages arising from Delfina\'s negligent supervision \\nstemmed\\xa0 from the uninsured risk of sexual misconduct, and thus there \\nwas no duty to defend a claim for negligent supervision.\\n\\nThe district court properly found that the policy\'s unambiguous \\nexclusion precluded coverage for claims against the Preciados, including\\n for the acts of Manuel and the negligent supervision against Delfina, \\nthus Farmers had the right to refuse to settle the claim without \\nexposure to a bad faith claim.\\n\\nZALMA OPINION\\n\\nLiability insurance is, by definition, a contract of indemnity for \\nunintentional and fortuitous acts. Allowing coverage for intentional \\nconduct, like the abuse of a child, would encourage people to commit \\nsuch evil conduct because there would be no financial effect to the \\nabuser.\\n\\n(c) 2023 Barry Zalma & ClaimSchool, Inc.\\n