Injury-In-Fact Trigger

What Is Injury-in-Fact Trigger?

Injury-in-fact trigger is a coverage trigger theory that states that an insurance policy coverage activates when an injury or damage actually occurs. An injury-in-fact trigger is used when courts find it difficult to pinpoint the exact time that an injury or damage occurs. The purpose of coverage triggers is to protect insurance companies to ensure that they only pay claims under specific circumstances listed in the insurance policy.

Understanding Injury-in-Fact Trigger

When writing insurance policies, insurance companies specify when they are liable to pay out claims. Coverage triggers are listed in a policy that stipulates the conditions that need to be met for a company to make payments to the insured. This helps insurance companies protect themselves from having to make payments for a longer period of time than necessary.

There are different types of triggers and depending on the type, an insurance company will make payments from a specific point in time.

Injury-in-fact triggers are sometimes referred to as actual injury triggers. Policyholders that seek to recover losses by filing a claim have to prove how and when the loss occurred. In some cases, this may be straightforward with a single, identifiable event leading to the loss occurring. In other cases, it may be difficult to ascertain when an injury or damage occurred, especially if the injury developed over a period of time. Courts use trigger theories in working through these complex situations.

In insurance parlance, a trigger is an event that activates coverage. Courts typically look to the four established trigger theories when making a determination. In addition to the injury-in-fact trigger, there is also an exposure trigger, manifestation trigger, and continuous trigger.

In the case of an injury-in-fact trigger, an occurrence is often said to have taken place when the claimant was injured, not when the wrongful act was committed.

For example, a company spilled hazardous waste into a local river in March 2020. The waste eventually makes its way into the drinking system several months later, and a family becomes ill after drinking it. The injury-in-fact trigger would be the time when the family became ill, not when the company spilled the chemicals.

In general liability policies, injury-in-fact triggers are said to apply when the injury or damage actually takes place, even if the injury or damage continues over a period of time. In this way, it is similar to a continuous trigger theory, though continuous trigger theory states that coverage is triggered when the claimant is exposed, actually injured, or the damage manifests itself.

Types of Coverage Triggers

As mentioned, in addition to injury-in-fact triggers, there are three additional coverage triggers. These are exposure, manifestation, and continuous triggers, each of which is described as follows:

Exposure Trigger

An exposure trigger occurs when an individual was first exposed to the issue that caused damage. This is most often applied in asbestos cases. The exposure trigger would be when the individual first inhaled the asbestos as opposed to when they finally got sick.

Manifestation Trigger

The manifestation trigger is activated when the injury or harm manifests or is discovered. It doesn't matter if the damage began prior to discovery, the policy is only triggered from the point of discovery.

Continuous Trigger

The continuous trigger is an all-encompassing trigger. Three main events result in the trigger: the period in which exposure occurred, when the actual damage happened, and when the damage was first identified.

A claims adjuster from an insurance company will conduct an investigation to determine which trigger applies in a specific case, usually known as a choice of law analysis. The analysis will examine multiple factors, including the location of where the damage occurred, locations of the policyholder and the insurance company, and the location where the policy was purchased. This particularly applies if the locations vary across different states.