The Kentucky Court of Appeals held that an “occurrence” may either be a fortuitous loss from an unintended “chance event” or a prolonged unintended action. The court concluded that the fortuitous loss is dependent upon the good faith of the actor and not the duration of the “occurrence.” Am. Mining Ins. Co., Inc. v. Peters Farms, LLC, 2016 WL 6543625 (Ky. Ct. App. Nov. 4, 2016).
The insured sued a mining company for extracting coal from its property without consent or written agreement. The mining company filed for bankruptcy and sought indemnity from its insurer. The court held that the extraction of coal was an “occurrence” that triggered coverage as an “accident, including continuous or repeated exposure to substantially the same general harmful conditions.” The court found that the mining company mistakenly extracted the coal from the insured’s property even though it had maps and did not have an extraction agreement with the insured. The court concluded that since the extraction was an “occurrence,” its insurer covered the claim.