But going through the above, I realized that I was not being sufficiently definitive. Can an insurer thus deny a claim resulting from the commission of a misdemeanour? Simply stated, law can be categorized into Civil Law and Criminal Law. This is what Life and Health Insurance Law has to say about Civil and Criminal Law:
Civil Law is “the body of law which determines private rights and liabilities… Criminal Law… prohibits and punishes conduct causing harm to the public.”
A crime is usually either a felony or a misdemeanour. A felony is a serious crime (e.g., physical assault, robbery, kidnapping, homicide or murder), for which the punishment can be imprisonment in a state or federal penitentiary, or even death. A misdemeanour is a lesser crime, usually punishable by fine or by imprisonment in a facility other than a penitentiary, such as a county jail.
In deciding what constitutes “violation of a crime”, we need to first understand what is the insurer’s intention in wording this phrase into the exclusion clause. Unfortunately, there is no definition of the phrase in all the insurance policies. In the US, it has been decided that this phrase is intended to exclude claims arising mainly from felonies, after a number of litigations.
In fact, the wordings in US policies are now very specific as to exclude only acts of felonies.