Update: What Constitutes One ‘Occurrence’ Under Liability Insurance Policies?

Per Madison Materials Co., Inc. v. St. Paul Fire & Marine Ins. Co., 2008 WL 867931, *4-*9 (5th Cir. Apr. 2, 2008)

The state-law based split over the meaning of ‘occurrence’ in insurance contracts, previously discussed on this blog here, proves decisive in this Fifth Circuit opinion, which holds that ten years of embezzlement are a single occurrence under Mississippi law’s interpretation of the relevant policy language. The Fifth Circuit holds that occurrence relates to the cause of the injury and that the single employee’s dishonesty caused all ten years of losses.

The CA 5 notes that an opinion from the CA 9, applying California state law, interprets similar policy language differently. As an initial matter, the relevant policy language was different (the Cali. case explicitly included a term limitation in the policy). More importantly, however, is the fact that this split turns on independent state grounds. The previous post contains the information necessary to distinguish these two cases.