Emerging Risks in Insurance: Cyberbullying
Insurers issuing all types of liability policies face a plethora of emerging risks this year. An informal survey of some of the larger insurance and reinsurance companies’ websites reveals long lists of emerging coverage issues, including greenhouse gases, nanotechnology, cyberbullying, sports concussions, extreme weather, fracking, cyberattacks, agroterrorism, solar flares and space debris, e-waste, supply chain vulnerability, and many others. This is the first in a series of articles examining some of these emerging risks and how they may impact (or are impacting) a particular sector of liability or property insurance.
This first article addresses the emerging risk of cyberbullying. Because this issue is at the forefront of news media and social media, it is becoming an important issue for the insurance industry, particularly homeowners carriers. One of the most recent instances of cyberbullying involved twelve- and fourteen-year-old girls in Polk County, Florida, who bullied another twelve-year-old girl through Facebook and other media until she committed suicide by jumping off a tower at an abandoned cement factory. Some of the bullies’ postings have been made public, and one posting revealed that one of the girls admitted to the bullying and said she did not care that the other girl killed herself. The Polk County sheriff, Grady Judd, arrested the two minors and is aggressively pursuing criminal action against them. He said he would go after the girls’ parents if he could find a legal basis to do so.
So what is cyberbullying? The Centers for Disease Control calls it “electronic aggression” and defines it as persons threatening, harassing, degrading, and/or humiliating others through digital media (e.g., websites, blogs, chat rooms, e-mails, texts, and instant messages). Some CDC examples include posting embarrassing personal information, photos, rumors, or lies; posing as someone else and bullying; and sending mean, threatening, or embarrassing texts, IMs, e-mails, etc. The CDC has classified cyberbullying as a probable emerging public health problem since 2009.
Cyberbullying is highly prevalent in today’s society, mostly among teens, and one survey showed it was more prevalent in middle school than high school. A report from the National Center for Victims of Crime showed that girls experienced online bullying more than boys. The increase in cyberbullying undoubtedly relates back to access – according to the National Crime Prevention Council, 83% of youth aged 10-18 use cell phones, and 77% send text messages. Another study found that 94% of youth aged 12-17 go online.
In a 2011 CDC nationwide survey, 16% of high school students reported they were bullied electronically in the prior twelve months, while 20% reported they were bullied on school property. Other studies indicate that 39-43% of teens using social media reported they had been cyberbullying victims. Some of the reasons for the proliferation: cyberbullying can occur 24 hours a day, 7 days a week, 365 days a year, and it is enhanced by the anonymity and the resulting “disinhibition effect” (i.e., people are less inhibited in what they say or post because of the anonymity). Also, cyberbullies get away with their bad conduct because children are less likely to tell adults about cyberbullying for fear that adults will restrict their access to the internet or take away their devices.
As cyberbullying increases, so do lawsuits. Many wrongful death suits have been filed, arising out of cyberbullying victim suicides. Lawsuits against the school or school officials may not be successful, depending on state law, because (a) cyberbullying frequently occurs off-campus, and (b) the school and its officials may have governmental immunity under state law.  All but one state in the United States have passed school anti-bullying legislation (all except Montana); specific cyberbullying laws are less prevalent. Many states address cyberbullying through existing criminal harassment and stalking statutes. Although Congress has amended the federal Computer Fraud and Abuse Act multiple times (originally aimed at computer hackers), it still does not expressly address cyberbullying.
Texas has an anti-bullying statute, but it applies only to on-campus or school-sponsored activities (Texas Education Code § 37.0832). The statute identifies what conduct constitutes bullying and requires school districts to have policies and procedures to prohibit bullying, to remedy bullying, and to report bullying; but, the statute does not make it a crime or prescribe punishment. Texas does have a criminal statute that prohibits a person from impersonating another person online (Texas Penal Code § 33.07).
Because schools and school officials may be liability-proof, victims and their families seeking compensation are turning to other defendants (e.g., the bully and the bully’s parents) and to different types of claims (e.g., defamation, intentional infliction of emotional distress, negligence, and premises liability). These types of lawsuits may implicate the parents’ homeowners’ policy, depending on state law.
Two coverage issues may be whether the victim’s harm constitutes “bodily injury” and whether the cyberbullying constitutes an “occurrence” under applicable law. In Texas, for example, the Texas Supreme Court has held that purely mental anguish or emotional injury, without any physical manifestation, is not “bodily injury” under the liability coverage of a homeowners’ policy. That Court recently concluded that “personal injury” (as used in a combined medical professional and general liability policy) did not cover purely mental anguish either. As for “occurrence,” typically defined in liability policies as an “accident,” Texas law generally provides that conduct is not an “accident” if the insured’s acts were voluntary and intentional, even though the result or injury may have been unexpected, unforeseen and unintended. 
Another issue may be the applicability of the intentional injury exclusion to claims against the bully. The Texas Supreme Court has interpreted the intentional injury exclusion to apply when the resulting injury or damage is intentional, not just when the insured’s conduct was intentional. Thus, to establish the exclusion applies, the carrier is likely required to prove that the cyberbully intended to cause injury or death, not just that the cyberbully intended to send the harmful texts or make the harmful posts. Another complicating factor could be whether the bully – if a minor – can form the requisite intent to harm under applicable law.
Nonetheless, pure negligence claims against the bully’s parents (e.g., negligent supervision) may trigger the duty to defend the entire lawsuit. Some newer homeowners’ policies contain coverage for defamation and invasion of privacy claims based on a more expansive definition of “personal injury.” Also, the Insurance Services Office, Inc. (a national promulgator of insurance forms) has generated an optional homeowners’ endorsement providing personal injury coverage for claims of slander, libel, and invasion of privacy, which could include some internet and electronic publications. See http://www.iso.com/ils/0000/ils0011.html#internet. The endorsement applies with an aggregate limit, rather than a per-occurrence limit. See id. According to the ISO’s website, ISO’s commercial lines staff also is studying the potential effect of increased blogging, cyberbullying, and electronic social networking on certain coverages under commercial policies, specifically with respect to personal and advertising injury coverage and employment-related practices liability coverage. See id.
The American Association of Insurance Services (another national promulgator of insurance forms) has generated an electronic aggression exclusion for personal umbrella policies. The exclusion uses the CDC term for cyberbullying and excludes coverage for bodily injury or personal injury arising out of “electronic aggression.” See http://www.aaisonline.com/AAISFrame/ConnectFrame/PressReleasesFrame/tabid/165/ArticleID/69/Electronic-Aggression-Addressed-in-new-Personal-Umbrella-forms.aspx. In the new AAIS exclusion, electronic aggression is defined as “including but not limited to harassment or bullying committed by means of an electronic forum, including but not limited to a blog, an electronic bulletin board, an electronic chat room, a gripe site, a social networking site, or a weblog; or by other electronic means, including but not limited to email, instant messaging, or text messaging.” See id.
Research revealed no reported opinions in coverage lawsuits arising out of claims or lawsuits for cyberbullying. Thus, insurers should keep an eye on this emerging and quickly developing area of both the law and insurance.
 See Amanda Lenhart, Senior Research Specialist, Pew Internet and American Life Project, Teens, Stranger Contact & Cyberbullying (prepared for the Internet Safety Task Force Apr. 30, 2008).
 Another defense that has been asserted in cyberbullying lawsuits is that the postings are protected “free speech.” However, the First Amendment does not protect against “true threats.” E.g., Virginia v. Black, 538 U.S. 343, 358-60 (2003); see also Shackelford v. Shirley, 948 F.2d 935, 938 (5th Cir. 1991). A California appellate court reviewing the ruling on an anti-SLAPP motion in a defamation lawsuit concluded that a defendant’s threatening comments on the minor plaintiff’s website (including threats to “rip out your f#$&@!% heart and feed it to you” and to “pound your head in with an ice pick”) were not free speech protected by the First Amendment. See D.C. v. R.R., 182 Cal. App. 4th 1190, 106 Cal. Rptr. 3d 399 (Cal. Ct. App. 2010).
 See Trinity Universal Ins. Co. v. Cowan, 945 S.W.2d 819, 823 (Tex. 1997).
 See Evanston Ins. Co. v. Legacy of Life, Inc., 370 S.W.3d 377, 382 (Tex. 2012) (relying on Cowan and concluding that, because “bodily” modifies “injury, sickness, and disease” in the definition of “personal injury,” a physical manifestation is required for coverage).
 Cowan, 945 S.W.3d at 827 (citing Argonaut Sw. Ins. Co. v. Maupin, 500 S.W.2d 633, 635 (Tex. 1973)); see also Republic Nat’l Life Ins. Co. v. Heyward, 536 S.W.2d 549, 555 (Tex. 1976).
 Some homeowners’ policies also contain criminal acts exclusions that could apply.
 See Tanner v. Nationwide Mut. Fire Ins. Co., 289 S.W.3d 828, 831 (Tex. 2009).