                IN THE SUPREME COURT OF IOWA
                                  No. 18–1550

                           Filed June 5, 2020


T.H.E. INSURANCE COMPANY,

      Appellee,

vs.

STUART R. GLEN,

      Defendant,

and

ESTATE OF STEPHEN PAUL BOOHER; GLADYS F. BOOHER, as
Administrator; and GLADYS F. BOOHER, Individually,

      Appellants.



      Appeal from the Iowa District Court for Polk County, Jeanie Kunkle

Vaudt, Judge.



      Appellants appeal the district court’s grant of summary judgment to

an insurer in a declaratory judgment action relating to insurance coverage.
REVERSED AND REMANDED.



      Fred L. Dorr of Wasker, Dorr, Wimmer & Marcouiller, P.C., West

Des Moines, Brian P. Galligan of Galligan & Reid, P.C., Des Moines, and

Nick C. Rowley of Trial Lawyers for Justice, Decorah, for appellants.



      John F. Lorentzen and Thomas C. Goodhue of Nyemaster Goode,

P.C., Des Moines, for appellee.
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APPEL, Justice.

      This case involves a question of whether a commercial general

liability policy and a related excess liability declaration cover claims

brought by the estate and spouse of an employee who was fatally injured

while an employee of Adventureland Amusement Park, located in Altoona.

      Booher was serving as a loading assistant on the Raging River ride

at the time he suffered his injuries. Booher’s estate and his widow filed

an action in district court, later removed to federal court on diversity

grounds, which alleged that the injuries to Booher were a result of multiple

grossly negligent acts by the ride’s operator, Adventureland employee

Stuart Glen.

      In response, the insurer filed a declaratory action in state court

seeking a declaration that the insurer had no duty to defend or indemnify

the coemployee in the underlying federal action. The Booher plaintiffs filed

a mirror image declaratory counterclaim. The federal court stayed the

proceeding diversity action pending resolution of the declaratory action in

state court.

      The parties in the state declaratory action filed cross-motions for

summary judgment.      The district court originally denied both parties’

motions. On reconsideration, however, the district court reversed course

and held that the insurer was entitled to summary judgment. The plaintiff

appeals.

      For the following reasons, we affirm in part and reverse in part the

judgment of the district court.

      I. Factual and Procedural Background.

      A. Underlying Lawsuit.

      1. The parties. The plaintiffs alleged that Stephen Booher was a

seasonal employee at Adventureland who had been recently employed as
                                      3

a loading assistant on the Raging River ride. This is a water ride where

the passengers are in rafts on conveyor belts that proceed along an ersatz

river. Plaintiffs alleged that defendant Stuart Glen was an employee of

Adventureland who served as ride operator of the Raging River on the date

of the incident.

      2. Nature of the incident.      On June 7, 2016, Booher allegedly

suffered fatal injuries when he and another coworker were jerked off their

feet and fell onto the moving belt that created the ride action. Booher was

drawn into the vortex between one of the rafts and a concrete sidewall.

Booher’s head was repeatedly rammed into the sidewall until the ride

operator, defendant Stuart Glen, finally stopped the ride.             Booher

ultimately died of his injuries four days later on June 11.

      3. Alleged acts and omissions of Glen. Plaintiffs claimed that the

gross negligence of Glen, the ride operator, was a proximate cause of the

death of Booher and the damages to his estate and spouse. The plaintiffs

alleged fifteen acts in support of its claim that Glen was grossly negligent.

      Some of the allegations include Glen’s acts and omissions that

allegedly occurred before the ride started: failure to check the ride before

starting it, failure to assure himself that the ride assistants were not

standing on any boat prior to starting the ride, and starting the ride

without first obtaining the thumbs up signal from the loading assistants

as required by prominently displayed instructions on the ride control

board located directly in front of the ride operator.      The plaintiffs also

claimed that Glen admitted that he caused the assistant to topple onto the

ride’s exposed conveyor belts.

      Other allegations appear to focus on acts and omissions that

occurred after the ride was started: failure to watch the ride for the entirety

of its operation; failure to stop the ride once he became aware of the
                                      4

incident due to his reckless, unexpected, wanton, and premature ride

start; leaving the operator’s station within the clear visual range of the

fallen loading assistants without shutting down the ride; failure to engage

the oversized red “E-Stop Aux” knob located immediately in front of him

after he became aware that the loading assistants were down and the ride

was still running; failure to key the ride to the off position after becoming

aware that the loading assistants had been jerked off their feet due to the

premature start of the ride; failure to stop the ride and leaving his station,

although he could easily observe that Booher had been knocked down and

his head and body were brought into continuous contact with that

sidewall; stopping the ride only after several ride patrons repeatedly yelled

at him to “stop the ride”; and failure to consider Booher’s injury, once he

was knocked down, as serious.

      Finally, several allegations do not have an explicit temporal

component.    For example, the petition claimed Glen’s gross negligence

arose from his failure to be on guard and his failure to understand his role

in responding to the incident.

      4. Damages. Booher’s estate and his surviving spouse sought six

categories of damages.     Specifically, they sought to recover damages

arising from loss of future earning capacity; physical and mental pain and

suffering; loss of spousal consortium, both before and after Booher’s

death; loss of parental consortium for Booher’s children; Booher’s

reasonable burial expense; and punitive damages.

      5. Removal of underlying tort action.         The defendants in the

underlying tort action removed the case to federal court on grounds of

complete diversity. T.H.E. then filed a state court declaratory judgment

action against the plaintiffs. The federal court stayed proceedings pending

resolution of the state court declaratory action.
                                     5

      B. State Court Declaratory Action. In the state court declaratory

action, T.H.E. alleged that Adventure Lands, Inc. was its named insured

under a Comprehensive General Liability (CGL) policy and commercial

excess liability policy. T.H.E. alleged that a gross negligence claim, like

that alleged by the plaintiffs, was inconsistent with the definitions of

“accident” and “expected” in the CGL policy and fall outside the scope of

coverage. The Booher plaintiffs responded by denying the allegations of

T.H.E. in the declaratory action, alleging affirmative defenses, and filing a

declaratory action of their own, asserting that T.H.E. had a duty to defend

and indemnify Adventureland against the Boohers’ claims under T.H.E.’s

CGL policy and under its excess coverage policy.

      The parties filed cross-motions for summary judgment. The district

court originally entered an order denying both motions. It reasoned that

whether there is coverage under the applicable insurance policies

presented genuine issues of material fact precluding summary judgment.

      T.H.E. filed a motion to reconsider. T.H.E. argued that determining

whether there is a duty to defend under insurance policies does not require

resolution of underlying facts but instead raises a question of law based

on the pleadings.    According to T.H.E., the issue to be resolved was

whether a claim of gross negligence is inconsistent with the coverage

provisions of the applicable policy. The Booher plaintiffs agreed, asserting

that the motion and cross-motions in the state declaratory judgment

actions raised a question of law.

      The district court reconsidered its prior order and granted T.H.E.’s

motion for summary judgment. In the new summary judgment order, the

district court vacated its prior order, granted T.H.E.’s motion for summary

judgment, and denied summary judgment to the Booher plaintiffs.
                                     6

      The district court first examined the nature of the Booher plaintiffs’

claim. The district court noted that under Iowa Code section 85.20(2)

(2015), the Booher plaintiffs do not have a claim against a coemployee for

ordinary negligence but only for “gross negligence amounting to such lack

of care as to amount to wanton neglect for the safety of another.”

      In this case, according to the district court, the Boohers’ claim of

gross negligence arose from Glen’s conduct after Stephen Booher fell into

the ride.   At that point, according to the district court, Glen, knowing

Stephen had fallen into the ride, left his station and failed to key the ride

off until several ride patrons repeatedly yelled at him to stop the ride.

According to the district court, the Boohers allege that Glen’s conduct

ripened into gross negligence because his failure to stop the ride after

Stephen had fallen into it “was the result of conscious indifference to the

rights, welfare and safety of [Stephen].” The district court characterized

the Boohers as claiming that once Stephen had fallen into the ride, Glen

had a duty to prevent further injury to Stephen. The district court then

proceeded to consider whether the Boohers’ gross negligence claim was

arguably or potentially covered under the applicable policies.

      The district court reasoned that the Boohers’ claim of gross

negligence was not covered under the CGL policy. The district court noted

that under the CGL policy, “bodily injury” must arise from an “occurrence.”

Under the CGL policy, an “occurrence” is “an accident, including

continuous or repeated exposure to substantially the same general

harmful conditions.” Applying caselaw, the district court reasoned, an

“accident” is an “unexpected and unintended ‘occurrence.’ ”          But the

injuries that occurred after Glen realized he had fallen in were not

unexpected and unintended but were the natural and expected result of

Glen’s conscious action in not stopping the ride. As a result, there was no
                                            7

coverage under the CGL policy because the Boohers’ gross negligence

claim was not an “accident” and therefore not an “occurrence” under the

policy. Using similar reasoning, the district court also held that there was

no coverage of the Boohers’ claim under an exclusion in the policy that

provided that injury that is expected or intended from the standpoint of

the insured is excluded from coverage.

       The district court considered whether the Boohers’ claim for

consequential damages such as loss of consortium, lost earning capacity,

medical expenses, and punitive damages were covered under the policy.

The district court found no coverage. Although the CGL policy covered

damages for “care, loss of services, or death,” the district court reasoned

that such damages in this case were not covered because there was no

“accident” or “occurrence” under the policy.

       II. Standard of Review.

       This case involves an appeal of the district court’s order on cross-

motions for summary judgment. Iowa R. App. P. 6.907.

       III. Overview.

       A. Introduction. This question of whether there is coverage for the

Booher plaintiffs’ gross negligence claim has two separate aspects. The

first issue is whether the gross negligence claim brought by the Booher

plaintiffs is covered under section I of the CGL policy. The central question

here is whether a claim of gross negligence is incompatible or inconsistent

with the coverage provisions and exclusions of section I.1

       1There   is a question of whether the Booher plaintiffs have preserved the argument
that their gross negligence claim is covered by section I of the CGL policy. Clearly, the
district court decided this question adversely to Booher. On appeal, however, the Boohers
primarily focus on their assertion that section II of the CGL policy provides coverage. The
Booher plaintiffs do claim on appeal, however, that the district court’s determination that
the terms “accident” and “occurrence” in section I were incompatible with a gross
negligence claim was “inaccurate,” that gross negligence is not intentional, and that the
concept of “expected” injury does not provide an excuse to avoid coverage. Further, T.H.E.
                                            8

       Aside from coverage under section I, a second question is whether

the provisions of section II of the CGL give rise to coverage of the Booher

plaintiffs’ gross negligence claim. Even if section I does not give rise to

coverage, the Booher plaintiffs claim that section II does and, to the extent

section II is inconsistent with section I, the more expansive provisions of

section II prevail.

       B. Provisions of Relevant Insurance Policies.

       1. CGL policy.         The commercial general liability policy (CGL)

involved in this case provides coverage for insureds, including for Glen.

Key coverage provisions are provided in section I, section II, and section V.

       Section I is entitled “COVERAGES.”               Section I includes coverage

provisions as follows: COVERAGE A—BODILY INJURY AND PROPERTY

DAMAGE LIABILITY; COVERAGE B—PERSONAL AND ADVERTISING

INJURY      LIABILITY;        COVERAGE          C—MEDICAL          PAYMENTS          AND

SUPPLEMENTAL PAYMENTS—COVERAGES A AND B.

       Under section I(1)(a) of the policy, the insurer agrees to pay sums

“because of ‘bodily injury’ . . . to which this insurance applies.” Section

I(1)(a) further provides that “we will have no duty to defend the insured

against any ‘suit’ seeking damages for ‘bodily injury’ . . . to which this

insurance does not apply.”

       Under section I(1)(b), the insurance applies only to “bodily injury” if

it is caused by an “occurrence.” Section I(1)(e) provides that damages

because of “bodily injury” include “damages claimed by any person or

organization for care, loss of services or death resulting any time from

‘bodily injury.’ ”


fully briefed the section I argument in its responsive brief on appeal and does not suggest
that it would be inappropriate for us to address the section I argument. Under the
circumstances, we conclude that we may address the section I argument.
                                        9

      Section I also contains exclusions from coverage.              Specifically,

section I(2)(a) excludes “ ‘[b]odily injury’ . . . expected or intended from the

standpoint of the insured.”

      Section II is entitled “WHO IS AN INSURED.”                 Section II(2)(a)

declares that employees are insureds but “only for acts within the scope of

their employment by you or while performing duties related to the conduct

of your business.” Section II(2)(a)(1) further provides that “none of these

‘employees’ . . . are insureds for: ‘[b]odily injury’ or ‘personal and

advertising injury.’ ”

      Section V is entitled “DEFINITIONS.” There are two definitions that

have a bearing on the case at hand. Section V(3) provides, “ ‘Bodily injury’

means bodily injury, sickness or disease sustained by a person, including

death resulting from any of these at any time.” Section V(13) provides,

“ ‘Occurrence’ means an accident, including continuous or repeated

exposure to substantially the same harmful conditions.”

      2. Multi-Plex      endorsement.       There   is   a   Multi-Plex   Liability

Endorsement (MPE) that modifies insurance provided under the CGL

policy.    The MPE notes that coverage under the CGL is “amended as

follows.” The MPE notes that coverage under the CGL is “amended as

follows:” and is followed by a header stating, “Employee v. Employee

Bodily Injury Liability—Additional Coverage,” under which it declares

that section II(2)(a)(1) is modified to eliminate the exclusion of “Bodily

Injury.”

      3. Excess coverage. There is also an excess coverage policy, which

T.H.E. admits “ ‘follows form’ with the CGL Coverage, and both provide

liability coverage for the same types of claims.” The excess policy states in

relevant part,
                                     10
      The insurance provided under this Coverage Part will follow
      the same provisions, exclusions, and limitations that are
      contained in the applicable “controlling underlying
      insurance,” unless otherwise directed by this insurance. To
      the extent such provisions differ or conflict, the provisions of
      this Coverage Part will apply. However, the coverage provided
      under this Coverage Part will not be broader than that
      provided by the applicable “controlling underlying insurance.”
      There may be more than one “controlling underlying
      insurance” listed in the Declarations and provisions in those
      policies conflict, and which are not superseded by the
      provisions of this Coverage Part.       In such a case, the
      provisions, exclusions and limitations of the “controlling
      underlying insurance” applicable to the particular “event” for
      which a claim is made or suit is brought will apply.

      C. Positions of the Parties.

      1. The Booher plaintiffs. On appeal, the Boohers argue that the trial

court failed to recognize the import of language in section II of the CGL

policy. According to the Booher plaintiffs, section II of the CGL policy

provides that Glen was an insured “for acts within the scope of [his]

employment.” The Boohers argue that Glen was certainly acting within

the scope of his employment when the incident occurred.

      Under section II, according to the Boohers, T.H.E. promised to

provide coverage for all acts within the scope of employment of employees

except for personal or advertising injury to coemployees, similar injuries

to family members, and several other irrelevant categories. The Boohers

characterize section II as creating coverage for “general employment acts.”

There is no applicable exclusion under section II prohibiting recovery of
relational damages such as loss of spousal and adult child consortium

sought by the Boohers.

      The Boohers cite the MPE modifying section II as evidence that

section II is a coverage issue.    The MPE eliminated a bodily injury

exclusion from section II.     T.H.E. characterized the modification as

providing “additional coverage.”
                                    11

      The Boohers seem to recognize that their interpretation of section II

of the CGL policy may be viewed as inconsistent with the coverage and

exclusion language of section I. Any ambiguity, according to the Boohers,

should be construed in favor of coverage.

      On appeal, the Boohers address the question of whether they have

sufficiently alleged gross negligence under Iowa Code section 85.20. The

Boohers assert, consistent with our caselaw, that gross negligence is

established when the following elements are met: “1. Knowledge of the peril

to be apprehended; 2. Knowledge that injury is a probable, as opposed to

a possible, result of the danger; and 3. A conscious failure to avoid the

peril.” Swanson v. McGraw, 447 N.W.2d 541, 543 (Iowa 1989) (en banc).

      The Boohers contend that the record supports a gross negligence

claim. They claim that the combination of events—prematurely starting

the ride in violation of park rules, seeing that a fellow employee was down

with injuries considered serious, park patrons yelling at him to shut off

the ride, and ignoring all of that while leaving the ride in operation—

constitute gross negligence.

      Finally, the Boohers attack the district court’s conclusion that the

policies cover “bodily injury” caused by an “accident” and are thus

incompatible with coverage for a claim of gross negligence under Iowa Code

section 85.20. According to the Boohers, gross negligence is “lack of care

as to amount to wanton neglect for the safety of another.” The Boohers

note that under Swanson, we observed “ ‘[W]anton’ conduct lies

somewhere between the mere unreasonable risk of harm in ordinary

negligence and intent to harm.” Id. at 543 (alteration in original) (quoting

Thompson v. Bohlken, 312 N.W.2d 501, 504 (Iowa 1981) (en banc)). As a

result, the Boohers assert that gross negligence is “decidedly different”

than an intentional act. The Boohers also claim that the “expected” injury
                                     12

definition does not provide T.H.E. with an excuse to avoid coverage.

Further, the Boohers suggest that whether the event and resulting harm

were “expected or intended from the standpoint of the insured” was a

question for the jury. Nat’l Sur. Corp. v. Westlake Inv., LLC, 880 N.W.2d

724, 735 (Iowa 2016). The Boohers further claim that there is no exception

to coverage under section II of the policy.

      2. T.H.E. The argument of T.H.E. on appeal follows the reasoning

of the district court. According to T.H.E., the CGL policy covers “bodily

injury,” the term “bodily injury” requires an “occurrence,” the term

“occurrence” requires an “accident,” and allegations that Glen was grossly

negligent under Iowa Code section 85.20(2) require an intended or

expected act that is inconsistent with an “accident.” As a result, there is

no coverage for the acts of gross negligence alleged by Boohers. Further,

like the district court, T.H.E. notes that there is an explicit understanding

from the term “bodily injury” that is “expected or intended from the

standpoint of the insured.”

      T.H.E. next addresses the Boohers’ argument that coverage for the

gross negligence claim may be found in section II of the CGL policy.

According to T.H.E., section II defines who is an “insured” but does not

define covered risks. T.H.E. asserts that section I provides for coverage for

“ ‘bodily injury’ . . . to which this insurance applies.” Under the immediate

antecedent rule, the term “to which this insurance applies” modifies the

nearest term “bodily injury” and not the more distant term “damages.”

      IV. Discussion.

      A. Introduction. The principles of interpretation and construction

of insurance contracts are well established. Generally speaking, the plain

meaning of the insurance contract prevails. See Thomas v. Progressive

Cas. Ins., 749 N.W.2d 678, 682 (Iowa 2008).         An insurance contract,
                                      13

however, is to be interpreted from the standpoint of an ordinary person,

not a specialist or expert. See Witcraft v. Sundstrand Health & Disability

Grp. Benefit Plan, 420 N.W.2d 785, 790 (Iowa 1988).

      Because insurance policies are adhesive contracts, we construe

provisions in the light most favorable to the insured.         See, e.g., A.Y.

McDonald Indus., Inc. v. Ins. Co. of N. Am., 475 N.W.2d 607, 619 (Iowa

1991) (en banc); Cairns v. Grinnell Mut. Reins., 398 N.W.2d 821, 824 (Iowa

1987). Ambiguities in an insurance contract are interpreted against the

insurer. See Boelman v Grinnell Mut. Reins., 826 N.W.2d 494, 502 (Iowa

2013). But the rule regarding ambiguities does not come into play unless

there is a real ambiguity in the terms of the policy. Randolph v. Fireman’s

Fund Ins., 255 Iowa 943, 945, 124 N.W.2d 528, 529 (1963).              A mere

disagreement between the parties does not establish ambiguity. N. Star

Mut. Ins. v. Holty, 402 N.W.2d 452, 454 (Iowa 1987). Only when policy

language is subject to two reasonable interpretations do we find ambiguity.

Kibbee v. State Farm Fire & Cas. Co., 525 N.W.2d 866, 868 (Iowa 1994);

see generally Boelman, 826 N.W.2d at 501–02 (discussing the legal

standards for interpreting insurance policies, including what constitutes

ambiguity).

      B. Coverage Under Section I. We first address the question of

whether there is coverage for Glen as an insured under section I of the

CGL policy. The question here is whether an act of gross negligence could

potentially be within the scope of “accident” as that term is used in the

CGL policy. See McAndrews v. Farm Bureau Mut. Ins., 349 N.W.2d 117,

119 (Iowa 1984) (en banc) (noting the question of coverage turns on

potential or possible liability under facts alleged). Or, put differently, does

the requirement in section I that the injury arise out of an “accident”
                                      14

foreclose the possibility of coverage for any claim that arises to “gross

negligence” as the term is used in Iowa Code section 85.20?

      We begin first with a discussion of coverage under section I(A) of the

policy. In order to be covered, the injury must arise from an “occurrence.”

Section V(13) defines “occurrence” as “an accident.”          The phrase “an

accident” is not defined, but under our caselaw, an accident is “an

unexpected and unintended ‘occurrence’ so long as the insured does not

expect or intend both it and some injury.” First Newton Nat’l Bank v. Gen.

Cas. Co. of Wis., 426 N.W.2d 618, 625 (Iowa 1988); see also Westlake Inv.,

LLC, 880 N.W.2d at 734–35 (discussing usage and meaning of the terms

occurrence and accident within the context of jury instructions, and within

the meaning of modern and past CGL policies); United Fire & Cas. Co. v.

Shelly Funeral Home, Inc., 642 N.W.2d 648, 652 (Iowa 2002) (finding that,

within the context of an insurance policy, “[t]he term ‘occurrence’ is

defined to mean ‘an accident, including continuous or repeated exposure

to substantially the same general harmful conditions.’ ”). Our approach

to the meaning of the term “accident” is consistent with the exclusion of

section I(2)(a), which excludes from coverage “ ‘[b]odily injury’ . . . expected

or intended from the standpoint of the insured.”

      We considered the meaning of the term “expected” in the context of

an insurance contract in Weber v. IMT Insurance, 462 N.W.2d 283, 287

(Iowa 1990).     In Weber, we noted that the term “expected” in an

exclusionary clause of an insurance company “denotes that the actor knew

or should have known that there was a substantial probability that certain

consequences will result from his actions.” Id. at 287 (quoting City of

Carter Lake v. Aetna Cas. & Sur. Co., 604 F.2d 1052, 1058–59 (8th Cir

1979)). Weber went on to explain,
                                      15
      In defining substantial probability, . . . “[t]he indications must
      be strong enough to alert a reasonably prudent man not only
      to the possibility of the results occurring but the indications
      also must be sufficient to forewarn him that the results are
      highly likely to occur.”

Id. at 287 (alteration in original) (quoting City of Carter Lake, 604 F.2d at

1059 n.4).    Subsequent caselaw has similarly upheld the proposition

expounded in Weber. By way of example, in Amco Insurance v. Haht, an

eleven-year-old boy intentionally struck another child with a baseball,

which led to the child’s death. 490 N.W.2d 843, 844 (Iowa 1992) (en banc).
As there was no evidence the boy knew, or should have known, that the

baseball striking the other child would lead to their death, it was therefore

not expected harm. Id. at 845.

      The term “substantial probability” is an elastic term that can mean

different things. In the context of an insurance exclusion, it means “highly

likely” or “substantially certain” to occur. See, e.g., Wickman v. Nw. Nat’l

Ins., 908 F.2d 1077, 1089 (lst Cir. 1990) (“ ‘[S]ubstantially likely to occur’

is an equivalent, if not tougher, standard to ‘highly likely to occur.’ ”); City

of Carter Lake, 604 F.2d at 1058–59 (“For the purposes of an exclusionary

clause in an insurance policy the word ‘expected’ denotes that the actor

knew or should have known that there was a substantial probability that

certain consequences will result from his actions.”); Ohio Cas. Ins. v.

Henderson, 939 P.2d 1337, 1345 (Ariz. 1997) (in banc) (finding an injury

is “expected” if it is “substantially certain” to occur); Shell Oil Co. v.

Winterthur Swiss Ins., 15 Cal. Rptr. 2d 815, 835 (Ct. App. 1993) (“The

ordinary and popular meaning of ‘expect’ connotes subjective knowledge

of or belief in an event’s probability. We see no material difference if the

degree of that probability is expressed as substantially certain, practically

certain, highly likely, or highly probable; the terms are minor shadings of

the same idea. . . . [This] convey[s] . . . that we do not think of events we
                                      16

‘expect’ as absolute certainties.”); Ind. Farmers Mut. Ins. v. Ellison, 679

N.E.2d 1378, 1382 (Ind. App. 1997) (construing substantial probability as

“consciously aware that the injury [is] practically certain to result”)

(quoting Ind. Farmers Mut. Ins. v. Graham, 537 N.E.2d 510, 512 (Ind. App.

1989))).

      We now turn to consider the meaning of the term “gross negligence”

under Iowa Code section 85.20. A key case is Thompson, 312 N.W.2d 501.

In Thompson, we declared that in order to show gross negligence under

Iowa Code section 85.20(2) (1977), a plaintiff must show three elements:

“(1) knowledge of the peril to be apprehended; (2) knowledge that injury is

a probable, as opposed to a possible, result of the danger; and (3) a

conscious failure to avoid the peril.” Id. at 505.

      Under Iowa Code section 85.20, gross negligence must “amount to

wanton neglect for the safety of another.” Id. at 504 (quoting Iowa Code

§ 85.20). Wanton neglect, according to Thompson, arises when the actor

is indifferent “as to whether the act will injure another.” Id. at 505. Under

our caselaw, “Wantonness is said to be less blameworthy than an

intentional wrong only in that instead of affirmatively wishing to injure

another, the actor is merely willing to do so.” Id.; see also Walker v. Mlakar,

489 N.W.2d 401, 404 (Iowa 1992) (en banc) (noting that coemployee must

undertake an intentional act, but need not intend to cause harm, in order

to be grossly negligent); Alden v. Genie Indus., 475 N.W.2d 1, 3 (Iowa 1991)

(finding a triable issue of gross negligence on the part of coemployee

supervisor where supervisor alleged they did not intend to cause some

kind of bodily injury).

      We now examine the degree to which a defendant must expect the

injury in order to be grossly negligent under Iowa Code section 85.20

(2015). Under the second element of gross negligence under Thompson,
                                     17

“knowledge that injury” must be “a probable, as opposed to a possible,

result of the danger.” Id. at 505. In the past, we have stated that in order

to be probable, injury must be “more likely than not.” Henrich v. Lorenz,

448 N.W.2d 327, 334 n.3 (Iowa 1989) (en banc).              In addition, the

coemployee must know of “the peril to be apprehended” and engage in a

“conscious failure to avoid the peril.” Thompson, 312 N.W.2d at 505.

      From the above analysis, it appears that a coemployee may act in a

fashion that meets the definition of “gross negligence” when an injury is

more probable than not and that such conduct might not be outside the

scope of the term “accident” in the CGL policy.        It is possible that a

factfinder could find that a coemployee acted without intent to harm and

with the expectation that an injury was more likely than not, but not with

the expectation that the injury was highly likely or substantially certain to

result. In other words, some, but not all, acts of gross negligence may not

be accidents. Cf. Buczkowski v. Allstate Ins., 526 N.W.2d 589, 590–91

(Mich. 1994) (finding that a result that might reasonably be expected is

not necessarily a highly likely one). It is possible for a plaintiff to thread

the needle by convincing a factfinder that acts or omissions of a

coemployee gave rise to an expectation that an injury was more likely than

not to occur, and thus amounts to gross negligence, but was not “highly

likely” and therefore outside of coverage for accidents.

      Here, the allegations are sufficient to permit the plaintiff to attempt

to sail between the rocks of immunity established by Iowa Code section

85.20 and the shoals of a coverage defense under Article I of the CGL

policy.   The plaintiff alleges a long laundry list of alleged acts and

omissions of Glen. Some occurred before the ride began, and others after

Booher was thrown into the ride. At this early stage of the proceeding,

based on the broad nature of the pleadings, we cannot say there is no
                                      18

possibility that Booher may not be able to convince a factfinder that he

has a claim that amounts to gross negligence but is within the scope of

the coverage of the CGL policy.

        C. Coverage Under Section II.       We now consider the alternate

ground of coverage under section II of the CGL policy advanced by the

Booher plaintiffs.    Certainly, the title of section II of the CGL policy

indicates the provision relates not to coverage of risks but instead to the

question of who is an insured. Yet, while some of the language relates to

who is an insured, there is also language in section II, particularly in the

exclusions, that trims the scope of who is insured based upon types of

risk.

        There is also some use of language in the evolution of the policy that

draws our attention. When T.H.E. eliminated the bodily injury exclusion

from section II(2)(a)(1), T.H.E. characterized the modification in a bolded

heading as “Additional Coverage.” The Boohers seize on this “Additional

Coverage” header, arguing that T.H.E. itself declared that section II is a

“coverage” provision and, as a result, it should be treated as such in this

litigation.

        In our view, the issue does not turn on use of the term “coverage” in

an endorsement to section II. The central difference between the approach

of the Booher plaintiffs and T.H.E. is this: the Booher plaintiffs believe

section II is a mechanism to provide additional coverage for claims beyond

section I, while T.H.E. sees section I and section II as independent screens

and that an insured must satisfy the criteria in each section in order to be

covered by the insurance.

        But that’s not how the CGL policy works. The insuring clause in

section I sets the parameters of the risks that are insured, while section II

establishes who is insured. A person with a claim under the policy must
                                    19

satisfy the coverage requirements of the insuring clause in section I and

be an “insured” under section II. While it is true that T.H.E. uses the term

“additional coverage” to describe an amendment to section II, the plain

language of the endorsement applies only to determinations of who is an

insured under section II. It does not address at all risks that are covered

as provided in section I.

      Thus, the Booher defendants suggest that section II as amended by

the endorsement and section I are in conflict, and therefore give rise to

ambiguity. We find they are not in conflict, but instead establish separate

tests, both of which must be satisfied to give rise to a duty to defend and

indemnify under the CGL policy.       As a result, we conclude that the

language in section II of the CGL policy does not provide additional

coverage of risks beyond those covered in section I.

      IV. Conclusion.

      For the above reasons, we conclude that the decision of the district

court on the motion for summary judgment should be reversed.

      REVERSED AND REMANDED.

      All justices concur except McDermott, J., who takes no part.
