How to Read Any Insurance Policy: 12 Rules

By | January 5, 2015

  • January 6, 2015 at 2:13 pm
    Peter Polstein says:
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    While having retired from Alexander & Alexander in 1997, and a contract writer for IRMI, and a consultant for a number of entities, personally I have always read all of he mind numbing language on every single contract that I have ever been involved in. Without reading the contract, how does one compare coverage to the binder ? Now while I am undoubtedly going to get a few adverse comments, the majority of business that I brokered was Fortune 500. Contractual language, which is sacrosanct irrespective of the subject matter is in fact the back bone of risk analysis. Be well all. Pete

    • January 6, 2015 at 3:45 pm
      Rosenblatt says:
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      Unfortunately, there are many people who choose not to read the contract, and that’s likely the norm moreso than the exception.

      Even more concerning is someone, let’s say an independent agent – but it could be anyone, who reads the contract but doesn’t have basic reading comprehension skills and misinterprets what it being offered and accepted.

      Not understanding what you’ve read may be worse than not reading at all.

    • January 6, 2015 at 4:16 pm
      Libby says:
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      Peter-

      I agree about reviewing contracts before selling them, especially manuscript or proprietary products like Executive Protection and other specialty coverages. But once you review and understand ISO forms, it’s really not necessary to re-read them each and every time. Only to be abreast of form changes and be aware of what endorsements will be attached that may change coverage.

      Congrats on your retirement! I remember A&A from years past! Along with BMF, J&H, Frank B. Hall, Fred S. James. I could go on. Sigh!

      • January 7, 2015 at 7:09 pm
        rocket88 says:
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        ISO forms? Ha! What’s that?

  • January 6, 2015 at 4:29 pm
    Ed Galloway says:
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    Glad Chris Boggs is back!

  • January 7, 2015 at 11:24 am
    Peter Polstein says:
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    Libby, thanks for the comment. One thing though. Despite the knowledge of the so called ISO form, the vast majority of contracts have any number of endorsements, either standard format or manuscript, and these are the very documents which can provide a problem. Take care. Pete

    • January 7, 2015 at 11:34 am
      Libby says:
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      Exactly. Endorsements are the killer!

  • January 7, 2015 at 12:40 pm
    Jake Jarmel says:
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    So basically just read the entire policy then.

    • January 7, 2015 at 10:37 pm
      Troy Johnson says:
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      Yes then you will be really upset. If we pull out what you are covered for you can barely fill one page.
      But yes I guess it’s as simple as read the whole thing.

  • January 7, 2015 at 2:00 pm
    knowall says:
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    I tell my insurance customers it is a good idea to read the policy and ask any questions; if nothing else it may help them with insomnia.

    One staid member of the community replied, to this suggestion: I always just look the agent in the eye to see if I trust them.

  • January 7, 2015 at 6:35 pm
    Duffy Reed says:
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    Wonder how we got so far from the 165 lines of the standard New York Fire Policy, would attorneys have any possible connection. :)

  • January 7, 2015 at 7:07 pm
    rocket88 says:
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    Just read the policy like AIG does. You read the exclusions very carefully. Define every exclusionary word six ways to Sunday. See if it applies to the claim. Practice preparing a reservation of rights letter utilizing the exclusionary wording or if needed, apply the exclusions from any other policy that seems to fits. Now you can file the policy away and relax knowing it doesn’t cover a thing!

    • October 2, 2015 at 3:42 am
      Kristopher says:
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      Very funny rocket, well played!



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