On November 24, 2022, New York’s Adult Survivors Act (“ASA”) (S.66A/A.648A) will go into effect and likely will usher in a tidal wave of litigation across the state. Employers will be impacted by the law, in addition to individuals, and the resulting litigation could span many years – particularly with the ongoing court delays related to the COVID-19 pandemic. As such, developing a proactive defense strategy for ASA claims and resolving potential insurance coverage issues in advance, is of vital importance as this date draws near.
What is the ASA?
As we’ve discussed previously, the ASA provides for a one-year lookback window, during which survivors of a sexual assault which occurred when they were over the age of 18 can sue the alleged abusers regardless of any applicable statute of limitations. To maintain a lawsuit under the act, claimants must allege that they were the victim of a sexual offense as defined under New York Penal Code Art. 130, which includes, among other things, sexual misconduct, rape, sexual assault, and forcible touching. Importantly, claimants are also authorized to bring related claims of negligence or intentional conduct against employers/institutions, including, for example, those based on an employer’s hiring, training, supervision, or retention of an alleged abuser. The law does not create an independent cause of action for claimants – unlike the Gender Motivated Violence Protection Law, which also has an upcoming lookback window – but instead revives a wide variety of claims that would otherwise be time-barred.
Why Employers Should Care:
The ASA follows in the footsteps of New York’s Child Victims Act (“CVA”), which created a similar lookback window for survivors of childhood sexual abuse to file civil claims against their alleged abusers and related institutions. During the two-year filing period, over 10,000 CVA cases were filed in New York State and Federal courts. The ASA is modeled on the CVA, yet provides for an even greater coverage period. Claimants are no longer limited to alleged conduct that occurred before they turned 18, rather they are permitted to raise claims for any covered conduct which occurred after that point. Given the enormous impact the CVA had on numerous institutions and employers across the State, the anticipated impact of the more expansive ASA simply cannot be overstated.
What Types of Insurance Coverage Issues Should Employers Consider as they Prepare an ASA Defense Strategy?
Finding old insurance policies which may implicate coverage has been a challenge for CVA defendants. As such, first and foremost, companies should develop a complete list of all insurance policies in place for each year the entity has or had been in operation. Consultation with current and former insurance brokers has been helpful in locating such policies for certain CVA defendants. Where older policies cannot be found, companies should gather any available parts of policies they can find – declaration pages, excess policies, or even documents referencing coverage such as canceled checks – and work with their brokers and carriers to locate the complete historical policy. This information, along with any renewal policies, payment records, or other proof of coverage, will be critical in quickly responding to any coverage disputes. Employers in specialized industries may also be able to speak with other businesses in that sphere to identify historical carriers who serviced that market. Further, even if a company’s own efforts to search for their policies are unsuccessful, insurance archeologists can be retained to help piece together an entity’s insurance portfolio.
Next, employers should examine their policies (including any changes over the years), to better arm themselves for potential coverage disputes. Older policies, which did not envision the scope of modern-day sexual abuse litigation, often do not contain the same types of coverage exclusions, aggregate limit caps, or provisions concerning defense costs, that would normally be found in modern-day policies. If the CVA is an indicator for how ASA claims will be handled by the courts, employers can anticipate lengthy, expensive, and slow-moving disputes that are often difficult to resolve. Recognizing the scope of coverage in advance will empower employers with the information they need to make important early litigation decisions.
Finally, companies who do, in fact, have an applicable policy should follow its terms to the letter and get insurers involved in any threatened litigation or pending suits as soon as possible. Notice provisions are routine in such policies, and failure to provide timely notice may limit or preclude coverage of an otherwise covered claim. Similarly, policies often require insureds to cooperate with the carrier in their defense and also mandate carrier consent before an insured settles a case. Failure to obtain prior approval of settlement offers can lead carriers to disclaim coverage for the agreement. These concerns only further emphasize the utmost importance of identifying and resolving coverage issues before litigation commences.
Employers can expect that the ASA will herald in years of complicated, grueling, and often costly litigation throughout New York State. Knowing whether they have insurance, whether their policies cover ASA claims, and if so, the extent of such coverage, will be an invaluable tool in preparing a proactive defense for employers.