In its recent decision in Hanover Am. Ins. Co. v. Saul, 2013 U.S. Dist. LEXIS 29739 (W.D. Okl. Mar. 5, 2013), the United States District Court for the Western District of Oklahoma had occasion to consider whether a chiropractor’s alleged failure to protect her patient from being sexually assaulted triggered coverage under a medical professional liability policy.
NCMIC Insurance Company insured Dr. Debora K. Balfour, and her practice, Dr. Deborah K. Balfour Chiropractic, P.C, (“DKBC”), under a professional liability policy. Dr. Balfour and DKBC were named as defendants in an underlying suit, along with Dr. Balfour’s ex-husband, in a matter involving alleged sexual assault, on multiple occasions, of one of Dr. Balfour’s patients, who was a minor at the time. It was alleged that Dr. Balfour’s ex-husband was the perpetrator of these assaults, some of which took place in the office building in which the DKBC practice was located. The suit alleged medical malpractice against Dr. Balfour for having allowed her husband access to the premises and for having failed to warn her patient regarding her husband’s “history and propensity to sexually molest under age females.” NCMIC agreed to provide Dr. Balfour and DKBC with a defense, but subsequently denied coverage.
The NCMIC policy insured “all sums to which this insurance applies and for which an insured becomes legally obligated to pay as damages because of an injury. The injury must be caused by an accident arising from an incident during the policy period. The injury must also be caused by an insured under this policy.” Notably, the policy defined “incident” to mean:
… any negligent omission, act or error in the providing of professional services by an insured or any person for whose omissions, acts or errors an insured is legally responsible.
Professional services, in turn, was defined as:
… services which are within the scope of practice of a chiropractor in the state or states in which the chiropractor is licensed.
NCMIC argued, among other things, that the policy only insured Balfour, and DKBC, for acts of medical malpractice, such as when a patient is injured while receiving chiropractic treatment. Dr. Balfour’s alleged failure to have warned her patient of a danger posed by her husband, argued NCMIC, did not relate to chiropractic services and thus fell outside the policy’s coverage. Dr. Balfour, on the other hand, argued that whether or not she had a medical professional obligation to warn her patient of her husband’s proclivities was an issued to be determined in the underlying action, not in the insurance coverage action. In other words, Dr. Balfour contended that the court in the declaratory judgment action could not adjudicate the scope of her medical professional duties to her patient.
The court rejected Dr. Balfour’s contention, agreeing with NCMIC that the policy insured Dr. Balfour solely with respect to chiropractic treatment per se. As the court explained:
The policy provides coverage for injuries such as those that result from a misdiagnosis or a negligently performed treatment, or perhaps even a failure to warn about the consequences of certain physical activity on an injury being treated.
The court agreed that while the plaintiff in the underlying suit alleged that Dr. Balfour breached a duty by failing to protect plaintiff from being assaulted, the duty alleged in the underlying suit was distinct from the medical duties insured under NCMIC’s policy:
Balfour's failure to warn her patient about [her ex-husband] and allowing him to have access to the building where her chiropractic practice was located - may be a violation of some duty, it is not a violation of a professional duty Balfour owed [her patient] as her chiropractor.
In reaching its decision, the court relied on case law standing for the general proposition that professional liability policies insure services involving specialized skill or knowledge. The court concluded that warning a person, even a patient, of the harm posed by another person on the premises, does not implicate such specialized skills or knowledge, and thus cannot be considered a professional service for the purpose of an errors and omissions policy.