I think you're missing the point of civil litigation. Criminal law exists to punish. Civil tort litigation exists so that people who experience financial harm are compensated by those who caused the financial harm through intentional or negligent actions. It's not about "punishing"--it's about compensation for financial harm that's been inflicted. Here, there's no question there was an intentional wrongful act. There's no question that that intentional wrongful act caused significant financial harm. It only makes sense to me that the person who committed the act is the one, ultimately, who pays for it. To me, the fact that the business's insurer, not the business itself, is out $10 million is completely irrelevant in the question of whether the arsonist should have a judgment against him for the damages he caused.
You can say that the intention of civil law is not to punish, and be perfectly right. But intentions mean less than reality, and in the end, a $10 million judgment against a ten year old is a punishment, no matter how justified it is. If the kid made $50 000 a year and worked for fifty years, he would earn an income of $2.5 million over his lifetime. Hardly enough to repay the debt, even if he saved every penny and put it towards compensation.
The crux of the argument is, does something stupid done as a ten year old justify a lifetime of debt? Or, at some point, should we accept that people do stupid things, and let it be? And give the kid a chance to have a real life?
What you seem to be missing is that yes, it is very much a moral argument. Legally, you're perfectly correct in saying that the insurance company
can sue the kid, and that they have a legal claim to do so. My point is that leaving the kid with a $10 million debt to haunt him for the rest of his life isn't going to do anyone any good. The insurance company isn't going to get its money unless the kid makes $200 000/year for 50 years and signs it all over to them, so the effort is futile to begin with, and it destroys any chance of the kid ever being able to lead a normal life. So while the company
can sue, maybe they
shouldn't. YMMV, but I feel like choosing to sue will gain them nothing and cost them, and the kid, a fair bit. It's lose-lose.