Can an Unborn Fetus Qualify as a ‘Resident of the Household’ for Coverage Determinations?

Resident of household exclusions in homeowners policies have been upheld as valid and enforceable and not violative of public policy.

For the household exclusion to apply, the claimant must qualify as a resident of the same household of a named insured and be deemed a relative or in the care of the named insured.

The term “resident of your household” has been held to be unambiguous and is to be interpreted according to its ordinary meaning.

An interesting question arises regarding whether the term “resident” includes an unborn child.

Typically homeowner’s policies do not define the term “resident.” Recently in Fire Ins. Exchange v. Horner, 368 S.W.3d 214 (Mo. App. W.D. 2012), the insured challenged whether the term “resident” included an unborn fetus. The insured argued that the term “resident” was ambiguous because a layperson would ordinarily interpret the term to include only living members of the household. Therefore, it was alleged that a layperson would not interpret the term “resident” to include a child who had not yet been born.

Several cases have addressed the question of whether the term “resident” includes an unborn child.

In Alabama Farm Bureau Mut. Cas. Ins. Co. v. Pigott, 393 So.2d.1379 (Ala. 1981), the Court found that the term “resident” was ambiguous as to whether it included an unborn child as an insured.

A similar result was reached by the Courts in Craig v. IMT Ins. Co., 407 N.W.2d.584 (Iowa 1987) and Sobeck by Sobeck v. Centennial Ins. Co., 234 N.J. 445, 560 A.2d.1309 (N.J. Super. Law Div. 1988). However, in Craig and Sobeck the question of whether the term “resident” included an unborn child was considered in the context of providing insurance coverage and not in the context of an exclusion. As an example, in Craig, the Court found that is was reasonable for the insured parents to believe that the term “person” in their insurance policy would encompass their unborn child. Therefore, the Court determined that the parents’ unborn child was a covered “person” and resided in the parents’ household. In Sobeck, the Court determined that an unborn child occupied the same household as her mother and therefore was an eligible covered person under the policy.

The Missouri Court of Appeals recently addressed this issue in Fire Ins. Exchange v. Horner, 368 S.W.3d 214 (Mo. App. W.D. 2012). In the Horner case, Gayle and Darrell Mansfield were the parents of Misty Mansfield and the grandparents of Misty’s daughter, Sydney. Seleb Horner was Misty’s boyfriend and the father of Sydney. Misty went into labor in early December of 2006, and Sydney was stillborn on December 6, 2006. Misty later died from complications of the birth. The Mansfields sued Seleb Horner, among others, for the wrongful deaths of Misty and Sydney. The Mansfields alleged that Horner provided inadequate care during the birth, thereby causing Sydney to be stillborn. The Mansfields further alleged that Horner provided inadequate care to Misty after the birth, thereby causing Misty’s death. The lawsuit was tendered to Fire Insurance Exchange (FIE) which had issued a homeowners insurance policy to Horner. FIE denied coverage based upon a household exclusion within the policy. FIE alleged that both Misty and Sydney were residents of the residence premises as defined by the policy and therefore the exclusion applied.

Turning to the Court’s decision in Horner, the Missouri Court of Appeals noted that while the Courts in Pigott, Craig, and Sobeck had found the term “resident” to be ambiguous, each Court came to the same ultimate conclusion that the unborn child was a resident of his or her mother’s household.

Moreover the Court in Horner found that the Tennessee case of Hollis v. Doerflinger, 137 S.W.3d.625 (Tenn. Ct. App. 2003) was more comparable to the facts presented before it. In Hollis a pregnant woman caused a car accident which resulted in the death of the mother and the unborn child. At the time of the accident the mother and her husband were covered under an automobile liability policy which excluded coverage for bodily injury to anyone related to the named insured who was a resident of the same household. The Tennessee Court of Appeals in Hollis found that the term “resident” was unambiguous and concluded that the unborn child resided wherever its mother resided. Therefore, the Court held the household exclusion applied.

The Missouri Court of Appeals in Horner held that the term “resident” was unambiguous and that the household exclusion applied. In doing so the Court made the following observation:

It would be unreasonable for Horner to believe that Misty, the mother of the unborn child, would fall within the exclusion, yet the unborn child in Misty’s womb would be covered simply because it had not yet been born. Furthermore, the Mansfields’ underlying lawsuit is premised on the fact that Sydney was a person capable of suffering bodily injury or wrongful death. If Sydney was a person capable of sustaining bodily injury, then she was capable of having a residence. [Citation omitted] We find that the term “resident” is used in the exclusion provision as unambiguous in that there can only be one reasonable interpretation—Sydney who was in her mother’s womb at the time of her injuries, resided wherever her mother resided. Therefore, Sydney resided with Misty in Horner’s household. Because the policy excludes coverage for bodily injury to residents of Horner’s household, [Fire Insurance Exchange] had no duty to defend or indemnify Horner in the underlying wrongful death action.