CGL policy to cover damages

SACRAMENTO, Calif.—Entercom Communications Corp.'s commercial general liability coverage, which was written by Chubb Corp., may respond to any damages the company must pay the family of a woman who died after participating in a water-drinking radio contest, market sources say.

Jennifer Strange's family filed a wrongful death lawsuit Jan. 25 in California state court in Sacramento. The suit seeks unspecified punitive as well as compensatory damages from Entercom; various individuals employed by the company; and its Sacramento radio station, KDND-FM, billed as "107.9, The End." Ms. Strange died shortly after participating in the station's Jan. 12 water-drinking contest.

Entercom's general liability coverage is written by Warren, N.J.-based Chubb, according to sources. Simkiss Cos. of Paoli, Pa., placed the coverage.

Punitive damages, however, generally are not insurable in California, unless liability is vicariously imposed on the defendants, according to attorneys.

The Strange family's suit asserts that contestants did not sign liability waivers, were not informed about the contest's health risks and were not offered any medical help after showing signs of physical distress while at the station's studio.

Even if criminal charges are filed against the station or Entercom personnel, the company's general liability coverage still should respond in the civil case, brokers agree. The Sacramento County Sheriff's Department has launched a criminal investigation into Ms. Strange's death.

General liability policies typically cover losses caused by "rogue employees," because "that's part of the risk we take," noted Robert Lystad, a vp and claims attorney in Kansas City, Mo., with managing general underwriter Media/Professional Insurance, a unit of Aon Corp. Media/Professional is not involved in Entercom's coverage.

Coverage in such a case could spark a variety of insurance-related questions, experts say.

"There's going to be some very complex legal issues" in the case, predicted Stephen Patterson, president of media insurance broker Preston-Patterson Co. Inc. of Conshohocken, Pa.