Glad to see a court find as it should. If the carrier intended to exclude any injury from an illegal activity it should have done that not specifically excluding illegal use of alcohol. Now for the bad faith claim.
Words mean what words mean. Early in my career back when underwriters still hand wrote policies for specific risks I encountered a claim on a policy written for “fire insurance on live chickens.” A fire occurred at a chicken (egg) ranch insured by the policy. When the claims department read the policy they told the underwriters that they had written a policy that did not cover the chickens if they died, only if they had been injured. In effect the policy covered the medical bills for any chickens injured in the fire, but if they died there was no coverage. The underwriters quickly revised the wording to cover “chickens” so would pay for the loss of thousands of chickens in a tragic fire…as intended! Words!!
This is a good story and it is presented well, but it isn’t correct. I don’t dispute that a claims department said this – pedants often unknowingly hide major mistakes they cannot see behind the petty truths they fixate on. A very common situation makes for a good comparison. When a frame 2 story dwelling burns to the ground, its would cease to be framed or two stories. It would not meet the policy definition of a dwelling. Yet the coverage is not nullified. Using “live chickens” only means they must have been alive immediately prior to the loss. There was probably no reason for the underwriter to say live chickens (dead layers have zero or negative value in most cases – unless the neighbor is a dog food company) but in no event would live chickens have to still be alive for coverage to exist.
While driving under the influence might be construed as illegal ‘use’ of alcohol, clearly the wording was too vague if DUI was the intended exclusion. The legal ‘experts’ who approved that one really missed a big gap.
Glad to see a court find as it should. If the carrier intended to exclude any injury from an illegal activity it should have done that not specifically excluding illegal use of alcohol. Now for the bad faith claim.
Words mean what words mean. Early in my career back when underwriters still hand wrote policies for specific risks I encountered a claim on a policy written for “fire insurance on live chickens.” A fire occurred at a chicken (egg) ranch insured by the policy. When the claims department read the policy they told the underwriters that they had written a policy that did not cover the chickens if they died, only if they had been injured. In effect the policy covered the medical bills for any chickens injured in the fire, but if they died there was no coverage. The underwriters quickly revised the wording to cover “chickens” so would pay for the loss of thousands of chickens in a tragic fire…as intended! Words!!
This is a good story and it is presented well, but it isn’t correct. I don’t dispute that a claims department said this – pedants often unknowingly hide major mistakes they cannot see behind the petty truths they fixate on. A very common situation makes for a good comparison. When a frame 2 story dwelling burns to the ground, its would cease to be framed or two stories. It would not meet the policy definition of a dwelling. Yet the coverage is not nullified. Using “live chickens” only means they must have been alive immediately prior to the loss. There was probably no reason for the underwriter to say live chickens (dead layers have zero or negative value in most cases – unless the neighbor is a dog food company) but in no event would live chickens have to still be alive for coverage to exist.
While driving under the influence might be construed as illegal ‘use’ of alcohol, clearly the wording was too vague if DUI was the intended exclusion. The legal ‘experts’ who approved that one really missed a big gap.