In many cases, a commercial general liability or business practice insurance policy may cover property damage caused by players, or even the player’s homeowner’s liability coverage may apply.

“If this property is damaged by others, the insurance carrier can institute a subrogation action if the property owners submit a claim, or the property owner could file suit against the tortfeasors directly,” says Rogers.

Line between digital and physical worlds

“Augmented reality games raise a number of legal issues because this sort of technology really straddles the line between the digital and physical worlds,” says Jim Carter, of counsel with the Washington, D.C., office of Blank Rome LLP. “Cyber security law is catching up and evolving with events that involve the digital world.”

“Liability will depend on the facts of a given case,” adds Carter. “A key factor is whether or not the developer knew or had reason to know of a particular situation and failed to act or act quickly enough.”

As part of the end-user license agreement that everyone downloads but rarely reads, the user consents to arbitration to address any disputes that arise and waives any right to a jury trial or class action lawsuit. However, Carter said he believes there will be bystanders who are not playing the game and have not agreed to the end-user license agreement, who may file suit against the developer. The same is true for children who download the app, since they would not be subject to arbitration.

Waiver option

Players do have the option to opt out of the waiver, but must do so within 30 days of accepting the terms of service agreement and it must be done in writing either via regular mail to 2 Bryant Street, Suite 220, San Francisco, CA 94105, or an e-mail to [email protected].

Niantic could also be held liable for the data it collect on gamers. It must comply with the Children’s Online Privacy Protection Act which imposes specific requirements on entities that provide services directed at children under the age of 13 and how their information may or may not be used. “Niantic could have liability in terms of data collection or from data breaches,” says Carter. He says any developer would be wise to review their cyber coverage and any limitations or exclusions.

PropertyCasualty360.com reached out to Niantic to ask how it views its liability with the game and will update this story when and if the company responds.

In this Tuesday, July 12, 2016 photo, a sign is shown at the National Weather Service in Anchorage, Alaska, informing Pokemon players that it's illegal to trespass on federal property. The staff started noticing an uptick of people in the parking lot after the location was included as a gym in the popular game. The "Pokemon Go" craze across the U.S. has people wandering into yards, driveways, cemeteries and even an off-limits police parking lot in search of cartoon monsters, prompting warnings that trespassers could get arrested or worse. (Photo: Mark Thiessen/AP Photo)

Other liabilities

Homeowners could also face liability if someone trespasses in their yard and is injured.

“If players come into your yard, they’ll probably find an old swing set, a trampoline or a pool,” says Eric Narcisco, CEO and founder of Albany, New York-based Effective Coverage, a provider of renters', home and auto insurance. Those are known as attractive nuisances, and if a ‘trainer’ is tempted by them and gets hurt, it could put your coverage at risk.”

“Trespassing on private property is a potential problem,” concurrs Chris Tidball, senior director-casualty solutions consultant for San Diego-based Mitchell, which provides technology and information software, “and there may be situations where property owners take the law into their own hands. Not only could this result in a tragic situation, but it would embroil the property owner in potential litigation.”

Tidball agrees that these situations could create issues for Niantic as well. “I definitely see the potential for litigation against them. After all, they are the deep pockets. It would make sense to pursue them. This would also apply from a subrogation standpoint, whereby insurers may be required to pay claims that are covered under the policy, but may have a right of recovery against the manufacturer.”

Negligence consideration

From a claims perspective, Tidball says negligence would also be a consideration in determining liability. In the case mentioned earlier where a gamer parked his car illegally before it was hit, an adjuster would examine it just like any other parked car accident. “There is certainly some liability on the illegally parked car, but generally speaking the majority of the fault would be with the striking vehicle. In every claim we examine duties owed and duties breached, and then determine the degree of breach against each party. Some carriers enlist the assistance of software which helps the adjuster to properly apportion liability.”

In cases where a minor causes the damage, his or her parents could be held liable, but Tidball says it will vary by jurisdiction. Consider a child playing the game who walks in front of a car without looking up and gets hit. The pedestrian is clearly at fault, but some jurisdictions will assess liability comparatively if the driver was going too fast or was on a cellphone.

As technology affects yet another aspect of claims, insurance adjusters will continue to apply the terms of a policy to each case, but there may be some interesting legal issues raised in the pursuit of the elusive Pokémon.

Related: Playing Pokémon Go? Here are 3 kinds of insurance you need