No Duty to Defend for Claims After Policy Expires


No Duty to Defend if no Bodily Injury, Property Damage or Personal Injury Alleged

When a plaintiff asks as their own attorneys they tend to have stupid clients and inadequate people pretending to act as a lawyer. Pro se plaintiffs allege multiple counts or causes of action without sufficient facts to truly allege a viable cause of action.

Proving so was the recent case of State Auto Property & Casualty Insurance Co. v. Bell & Arthur Condominium Association, et al., No. 18 C 5927, United States District Court Northern District Of Illinois Eastern Division (April 14, 2020) where State Auto the insurer of Bell & Arthur Condominium Association (“the Association”) sought coverage for a suit by Alan and Nawwar Alhomsi  against the Association and the Individual Defendants in Illinois state court. The Alhomsi plaintiffs alleged that fraud, conversion, property damage, misuse of corporation funds by board members of the Association.  State Auto sued seeking a Declaratory Judgment regarding whether it had to defend the Association and Individual Defendants and for the Reimbursement of its Defense Costs incurred.


The Alhomsi’s Third Amended Complaint contains 27 separate counts. The heart of the lawsuit is a dispute between the Alhomsis and the Association.  The Alhomsi suit, which is brought pro se, seeks $200,000 in damages. The specific claims include multiple allegations of misfeasance by the Association Board. Many of the Counts were brought as derivative on behalf of the Board. As admitted by Defendants, Counts 1, 10, 15-21, and 23-27 of the Third Amended Complaint seek damages for an occurrence or offense which occurred after December 6, 2015, which is after the expiration of the State Auto policy. During the course of the Underlying Litigation, Alan Alhomsi became a duly elected member of the Board of Directors.

State Auto issued its policy to the Association as named insurer and provided for Businessowners Insurance, on a primary basis, for the effective period of December 6, 2014 to December 6, 2015.


In Illinois, the interpretation of an insurance policy is a question of law that is properly decided by way of summary judgment. A court determines whether an insurer has a duty to defend by examining the underlying Complaint and the language of the insurance policy. Once the duty to defend is found to exist with respect to one or some of the theories of recovery advanced in the underlying litigation, the insurer must defend the insured with regard to the remaining theories of recovery as well. The burden of proving that a claim falls within an exclusion rests squarely on the insurer.


The question before the Court is whether the allegations in the Alhomsi Defendant’s underlying Complaint trigger State Auto’s duty to defend. State Auto claims the policy does not trigger the duty to defend on several grounds including that some of the counts are precluded because they fall outside the policy coverage; that the State Auto policy excludes coverage for claims brought or maintained by or on behalf of an insured; that the policy does not cover the Association’s claims as the underlying plaintiffs cannot prosecute or recover those damages; that there is no coverage for claims that do not involve “bodily injury” or “property damage” caused by an occurrence and the policy excludes expected or intended injury; there is no coverage for personal and advertising injury liability; and that there is no coverage for the individual defendants for claims that arose out of or in connection with conduct that was not part of their duties as officers or directors of the Association.

State Auto argued that the Complaint does not allege property damage or bodily injury. State Auto argues that the policy is unambiguous and only covers claims that an insured becomes legally obligated to pay as damages because of bodily injury or property damage to which the insurance applies, which they argue is only an occurrence.

The Complaint does not allege any facts to indicate the damage to the roof or masonry was a result of an occurrence and thus it does not fall within the policy’s coverage. There are a several counts where property damage is alleged on the face of the Complaint yet are outside of the policy term and are therefore not covered by the policy.

A court may not, and will not, read into the complaint facts that are not there. The mere possibility that covered damage occurred does not trigger a duty to defend under Illinois law.  The Court is not permitted to speculate about possible factual scenarios that are absent from the claim itself. Thus, while it is possible that the property damage giving rise to a breach of fiduciary duty transpired during the policy period, the Alhomsi Defendants failed to plead any facts to indicate that property damage occurred or that it occurred during the policy period and the Court declines to infer that it did.

Because there were no bodily injuries, property injuries, or personal or advertising injuries alleged during the policy period that would trigger coverage, the motion for summary judgment was granted. As such, no other claims need be addressed. State Auto has shown that there are no genuine issues of material fact on whether it has a duty to defend the Association and Individual Defendants. Accordingly, State Auto’s Motion for Summary Judgment was granted.


The insurer, and the court, were required to go through more than 20 counts that failed to allege any facts that constituted an occurrence during the period that State Auto’s policy was in effect. The court gave serious, albeit, wasted consideration to all of the allegations of the Alhomsi defendants and found them wanting. A lawyer, as the court pointed out, might have been able to allege a cause of action after three attempts. The Alhomsi’s, not lawyers, failed and the motion for summary judgment was granted, because the court could not, and would not, rewrite the litigation.

© 2020 – Barry Zalma

This article, and all of the blog posts on this site, digest and summarize cases published by courts of the various states and the United States.  The court decisions have been modified from the actual language of the court decisions, were condensed for ease of reading, and convey the opinions of the author regarding each case.

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant  specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at and

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

Over the last 52 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

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About Barry Zalma

An insurance coverage and claims handling author, consultant and expert witness with more than 48 years of practical and court room experience.
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