All in the Family, but not All in the “Household” (PA)

In Ripley Jr. v. Brethren Mutual, an insured’s grandson aided in the theft of personal property from the residence he shared with his grandparents. The grandparents filed a claim with their insurer, Brethren Mutual, for the loss. Brethren Mutual disclaimed coverage on the grounds that the grandson was a member of the household. The policy defined “insured” to include members of the household including relatives.

The District Court for the Eastern District of Pennsylvania found that the grandson of the insured, though he resided on the property, was not necessarily an “insured” for the purposes of a policy exclusion.  Specifically, the policy contained an exclusion for damage arising out of any act an “insured” commits, or conspires to commit, with the intent to cause a loss.

The court found that the determination of who is a member of a household is a fact-specific inquiry and is not determined solely by the fact that the individual is a relative. The court found that an essential inquiry is whether the individual was “treated as one would expect a member of the household to be treated”. The court ultimately found that a relative’s living arrangements alone was insufficient to conclude that there was no genuine issue of material fact regarding whether the policy’s exclusion applied and denied summary judgment.

The Ripleys, it seems, will be able to control their own destiny as to whether this exclusion will apply – which is the exact circumstance the insurer was trying to avoid.

Thanks to Tiffany Davis for her contribution to this post, and please email Brian Gibbons with any questions.