Coverage for punitive damages are not always covered in an insurance policy. This issue came up in the 2018, case styled, Richard Brett Frederking v. The Cincinnati Insurance Company, Inc. The case is from the U.S. District Court, Western District of Texas, San Antonio Division.
This is a summary judgment case if favor of Cincinnati. The Court held that the insurance policy at issued does not afford coverage for the punitive damages award attributed to the negligence of Carlos Sanchez.
Frederking was injured when his vehicle was struck by an intoxicated driver, Carlos Sanchez. A trial was held in State Court and the jury found Sanchez was grossly negligent and awarded Frederking $207,550.00 in punitive damages plus interest. The issue is whether the policy held by Sanchez’s employer covers this punitive damages award.