I was spotting a client on a bench press. My hand grazed her chest while helping her lift the bar. Two days later, I received a notification that she had filed a police report for sexual assault and a civil suit for battery and emotional distress. I am innocent, but the accusation alone is destroying my reputation and business.
Key Takeaways
- The “Abuse & Molestation” Exclusion: Almost every standard GL policy excludes claims arising from actual or alleged sexual misconduct.
- Defense Costs: Even if you are innocent, defending this lawsuit costs $50,000+. You need a policy that provides “Defense Expense Reimbursement” for abuse claims.
- “Innocent Party” Defense: If you own a gym and your employee is accused, you need coverage that protects the business even if the employee is guilty.
- Tactile Cueing Consent: Did you get verbal permission to touch?
The “Why”: The Silent Exclusion
The Trap:
Search your policy for “Abuse,” “Molestation,” or “Sexual Misconduct.”
You will likely find it in the Exclusions section.
This means if a client sues you for “inappropriate touching,” the insurance company has no duty to defend you. You are on your own.
You must buy a specific endorsement called “Abuse and Molestation Coverage” (often sub-limited to $25k or $100k).
The Investigation: I Quoted 3 Major Carriers
1. Philadelphia (PHLY)
- My Analysis: They offer specific Abuse & Molestation coverage. It requires you to run background checks on all staff. If you skip the background check, the coverage is void.
2. West Bend
- My Analysis: They are strong on this. They provide “Defense outside the limits.” This means legal fees don’t eat up your settlement money. Essential for these high-emotion cases.
3. Markel
- My Analysis: They offer it as an option. It covers “actual or threatened” abuse. They emphasize “Safe Sport” training compliance.
[IMAGE: Graphic showing “Consent to Touch” cards used in gyms]
Comparison Table: Misconduct Defense
| Carrier | Abuse Coverage Included? | Defense Costs? | Background Check Required? |
| PHLY | Endorsement | Yes | Yes |
| West Bend | Endorsement | Yes (Outside limits) | Yes |
| Standard | NO | NO | N/A |
Step-by-Step Action Plan
- Get the Endorsement: Call your agent. Ask “Do I have Abuse and Molestation defense coverage?”
- Change Spotting Protocols: Use “side spotting” or no-touch cues whenever possible.
- Consent Policy: Implement a “Red Light / Green Light” system where clients can silently signal if they want tactile cues.
- Never Alone: Avoid 1-on-1 sessions in closed rooms without windows or cameras.
FAQ
If I am found guilty, does insurance pay?
No. Insurance never covers criminal acts. They usually pay for the defense until a guilty verdict is reached, then they stop and may ask for reimbursement.
Does this cover verbal harassment?
Yes, usually under EPLI (Employment Practices) or Abuse definitions.
Why is this coverage so hard to get?
Because jury verdicts in abuse cases are massive (“Nuclear Verdicts”).