Morris Manning & Martin, LLP

Sex Trafficking is Uninsurable as a Matter of Public Policy, District Court Rules


The Eastern District of Pennsylvania recently held that insurers need not defend or indemnify their policyholders against allegations of sex trafficking on public policy grounds. The opinion in Samsung Fire and Marine Ins., Co. LTD., v. UFVS Mgmt. Co., LLC1 follows and expands upon a string of recent decisions in the Third Circuit, finding that insurers need not defend or indemnify hotel owners and operators for negligently enabling sex trafficking, particularly of minors.2

In Samsung, four minors alleged in underlying state court cases that they were victims of sex trafficking at a hotel in Philadelphia owned and operated by the policyholders, to whom insurers had issued liability and umbrella policies. The four minors alleged that the policyholders negligently failed to prevent a sex trafficking scheme at the insured hotel despite clear signs that trafficking was taking place there. The policyholders requested a defense from their insurers, and the insurers brought Samsung as a declaratory judgment action seeking a ruling that they had no duty to defend or indemnify.

The District Court ruled in favor of the insurers in a sweeping fashion. Whereas recent decisions in the Third Circuit had found that allegations of sex trafficking ran afoul of particular exclusions in liability policies, the Samsung court held that Pennsylvania “public policy bars insurance coverage for those allegedly involved in enabling human trafficking.” The court acknowledged that it may make a determination on the basis of public policy decision only in the “clearest of cases,” but found that it “strains to imagine a clearer case” than allegations of minor sex trafficking. The court reasoned that the enactment of a statute criminalizing the alleged conduct was a clear enunciation of public policy and that sex trafficking clearly infringed upon public safety, morals, and welfare.

With the growing tide of sex trafficking litigation around the country, particularly in Georgia, insurance coverage disputes over claims related to the negligent enablement of sex trafficking are sure to arise. The Samsung decision demonstrates that some courts are taking a hard line against the insurability of such allegations, and it is likely to be an important decision for insurers who have issued liability policies to hotel owners and operators.

If you have any questions about this update, contact Seslee Smith, Ryan Burke, or Nathan Miles, of the firm’s insurance coverage and litigation team.

[1] Samsung Fire and Marine Ins., Co. LTD., v. UFVS Mgmt. Co., LLC, et al., No. 18-cv-4365, 2023 WL 2574971 (E.D. Pa. 2023)
[2] For more extensive discussion of the prior sex trafficking cases and the impact of exclusions, see MMM’s November 2, 2022, at