Liability Insurance at the Tort-Crime Boundary
Liability insurance defines the boundaries of tort law-in-action in a variety of ways-As a formal matter, tort law generally ignores whether defendants have liability insurance, as well as the prevailing verbal and dollar limits on that insurance (Stapleton 1995).1 Yet, liability insurance is close to a de facto element of tort liability whenever the potential defendants are individuals, and liability insurance even shapes claims against large, well-funded organizations (Baker 2006; Black, Cheffins, and Klausner 2006; Zeiler et al. 2007; cf. Baker and Griffith 2008). Tort liability certainly exists out from under the liability insurance umbrella, but tort lawyers do not go out there very often, because there is less return in it. While there are exceptions, lawyers prefer to ask a liability insurer to pay—because paying claims is the business of liability insurance (Baker 2001). For this reason, liability insurance must be counted among the sites in which to investigate the relationship between tort law and culture. Whatever legal culture is, it surely affects liability insurance institutions, and these, in turn, affect-and are affected by-the development of tort law.
This chapter explores how liability insurance mediates the boundary between torts and crime. Liability insurance sometimes separates these two legal fields, for example, through the application of standard insurance contract provisions that exclude insurance coverage for some crimes that are also torts. These exclusions largely remove these crimes from the reach of civil law, as demonstrated, for example, by the dearth of tort claims involving domestic violence, molesta tion, and other assaults, notwithstanding the prevalence of these crimes in the