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State Farm Sues Not to Pay Sandusky's Legal Fees

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By Andrew Lu on July 30, 2012 6:49 AM

State Farm insurance company has brought a federal lawsuit to get out of paying Jerry Sandusky's considerable legal bills.

Sandusky bought a fairly typical home insurance policy from State Farm in 1985. When the sexual abuse scandal broke, Sandusky sought to utilize his insurance to pay his legal bills from both his criminal and civil cases.

State Farm initially declined to cover the criminal matter, but did pay for Sandusky's civil bills. The insurance company is now seeking a declaratory judgment from a court stating that it doesn't have to pay for any of Sandusky's bills -- civil or criminal -- reports Fox Business.

Home-insurance policies generally include a personal-liability coverage that helps policyholders with their legal defense costs. This can include covering the costs of lawsuits in matters like a dog bite or a slip and fall on the homeowner's property.

However, these policies usually have limits and do not cover criminal matters or willful acts of misconduct. In its lawsuit, State Farm argues that its policy specifically excludes bodily injuries resulting from "intentional acts" and seeks to be excused from covering any of Sandusky's bills.

Additionally, the insurance company argues that it does not cover "business activities," and as Sandusky is being sued in his official capacity as principal at his charity the Second Mile, the home insurance company should not cover these activities, reports Fox Business.

Similar to State Farm, Second Mile's insurance company, Federal Insurance Company, is also seeking declaratory judgment to get out of paying Sandusky's bills.

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