The Tenth Circuit held that abuse of several victims amounted to one abuse and one retained limit applied before the insurers’ obligations arose. Church of Jesus Christ of Latter-Day Saints v. Nat’l Union Fire Ins. Co. of Pittsburgh, PA., 2026 U.S. App. LEXIS 22404 (10th Cir. July 28, 2026).

Thirteen-year-old Michael Jenson groped two 13-year-old classmates on separate occasions. He pled guilty to two misdemeanors.

Jensen’s mother was the Relief Society President at the Church of Jesus Christ of Latter-Day Saints and offered her son’s services as a babysitter to other church families. Jensen sexually abused several children he was babysitting. He was convicted of sexual assault and sexual abuse.

Some of Jensen’s victims sued his parents, church officials and the church itself. The church eventually settled with the plaintiffs.

During the trial, the church tendered to its insurers, National Union and Ace. The insurers refused to defend or indemnify for the settlements reached.

The church sued for breach of contract and breach of the implied covenant of good faith. At issue was whether the church paid the required retentions before the insurers were obligated to defend and indemnify. No single settlement between the church and one of Jensen’s victims met the policies’ retained limits. The church argued its negligence was one occurrence, while the insurers argued that it was several.

The district court granted summary judgment to the insurers, ruling that the policies’ definitions of “occurrence” unambiguously meant that the abuse of separate victims at separate times and in separate places presumptively constituted multiple occurrences. It held that a separate occurrence arose every time Jensen abused separate children at separate times and in separate places.

The Tenth Circuit disagreed. The policies’ definitions of ‘occurrence” were ambiguous. The policies had similar definitions “occurrence.” The Ace policy read,

[A]n accident, including continuous or repeated exposure to substantially the same general harmful conditions. All such exposure to substantially the same general harmful conditions shall be considered as arising out of the same “occurrence” regardless of the frequency or repetition thereof, or the number of claimants.

The church argued that its failure to prevent Jensen’s several instances of abuse counted as one occurrence. The court agreed. The Ace policy stated that “exposure to substantially the same general conditions” was one occurrence “regardless of the frequency or repetition thereof, or the number of claimants.” To the church, this meant that there was one occurrence when separate victims were exposed at separate times in separate places to the dangerous environment created by the church’s alleged negligence.

This was a reasonable interpretation of the provision. Regardless of whether the insurers’ interpretation was also reasonable, an ambiguity that was construed in the church’s favor existed.