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ARTICLE · 08 JUNE 2026

Pro-Policyholder Trend Continues In TVPRA Coverage Litigation

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Recent federal court decisions have established important precedents for insurance coverage in sex trafficking lawsuits, particularly those involving hotels under the Trafficking Victims...

United StatesInsurance
Donald W. Kiel
Donald W. Kiel
Erin Fleury
Erin Fleury
Alexandra DiFusco-Cox
Alexandra DiFusco-Cox

In a pro-policyholder trend, multiple federal courts have recently resolved several important insurance coverage issues arising from underlying lawsuits alleging sex trafficking.

In recent years, general liability insurers have increasingly disclaimed their defense obligations to hotel franchisors or operators sued for allegedly benefiting from the use of their hotels by third-party criminals using the hotels as a location to commit criminal sex trafficking, including claims brought under the federal Trafficking Victims Protection Reauthorization Act (TVPRA). Insurers regularly argue, inter alia, that coverage is barred by: (1) public policy; (2) abuse or molestation exclusions; or (3) policy limitations regarding the insureds’ subjective intent or knowledge. In February 2026, however, the US District Court for the Southern District of Indiana rejected an insurer’s effort to evade its obligation to defend a hotel franchisor and franchisee/operator in a TVPRA action, granting summary

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