Court Denied Insurance Coverage in Kentucky Care Death

The Sixth Circuit ruled an insurer is not liable for a behavioral center death involving physical restraints.

Updated on Oct. 5, 2026 in Insurance

Bold flat-color editorial illustration of a stylized institutional facade in navy and cream, evoking the gravity of a legal ruling. — The Sixth Circuit Court of Appeals ruled that an insurance provider is not liable for a fatal incident at a Kentucky behavioral care facility. AI Illustration. Upload story photo >

The Sixth Circuit Court of Appeals ruled on September 9, 2026, that an insurance provider has no duty to indemnify a Kentucky behavioral care center for a 2022 death. The court determined that the restraint intervention used on a seven-year-old resident qualified as an excluded professional service.

Why it matters

This decision clarifies how liability policies interpret professional services, potentially shifting the financial burden in wrongful death cases involving medical and behavioral care facilities. By focusing on the nature of the act itself, the court set a precedent that standard liability exclusions remain valid even when services are performed improperly.

The case involved the death of a seven-year-old resident, which the court analyzed under three factors: the demand for specialized knowledge, the requirement of judgment, and state regulatory oversight.

The players

Sixth Circuit Court of Appeals

This federal appellate court hears cases from Kentucky, Michigan, Ohio, and Tennessee.

Seven Counties Services, Inc.

This is the behavioral care center involved in the litigation regarding the resident's death.

Scottsdale Insurance Co.

This is the insurance provider that successfully argued against the duty to indemnify the care center.

Kentucky Office of Inspector General

This state agency oversees health facility investigations and concluded the center failed to protect the resident.

The details

The court found that the physical restraint performed by care workers constituted a professional service because it required specialized training and judgment under state regulation. Because the facility's commercial general liability policy excluded injuries from such services, the insurer was found not to have a duty to cover the facility following the fatal incident.

A seven-year-old resident died at the behavioral care center in July 2022.
The Sixth Circuit Court of Appeals issued its ruling on September 9, 2026.

Market Dynamics

The ruling in Scottsdale Insurance Co. v. Seven Counties Services, Inc. establishes a binding precedent for how professional service exclusions are interpreted in the region. This decision significantly limits the scope of liability coverage for care facilities, impacting how insurers price and manage risks for behavioral centers.

This ruling highlights the importance for facility operators and stakeholders to review the specific language in liability policies, particularly regarding professional service exclusions. It demonstrates the financial risk inherent in claims where the nature of a service is categorized as specialized, potentially impacting the insurability of certain medical practices.

The takeaway

Facilities must ensure their insurance policies explicitly define or account for restraint interventions if they wish to mitigate against coverage denials. This case serves as a reminder that courts look at the technical nature of actions when determining whether a policy exclusion applies.