An engineering firm challenged its insurer after a claim it submitted was turned down for coverage. The firm asked to be reimbursed for theft of important papers that were stolen from an employee’s car. The insurer believed that the circumstances of the loss was ineligible under its policy.

The policyholder appealed the decisions of lower courts that ruled in favor of the insurer. The position they held was that the basis for excluding the loss was in error.

Click below to read how the courts eventually determined what was at the heart of the dispute. It involved how the insurance company interpreted what was meant by storing papers. It was a critical point!

What can be very frustrating to the insuring public is the level of fragmentation that exists with insurance. On the surface, that is understandable. Whether buying coverage for personal or business exposures, many are perplexed by the many different types of policies that are required. Even within a given business policy, the various coverage parts, exceptions, supplements, conditions, endorsements and exclusions can be baffling.

Policyholders are frequently urged to carefully read their policies. The intent is to promote their gaining a better understanding of their protection. Of course, it’s also meant to reduce excuses for claiming that their coverage expectations weren’t met. That’s an easier argument when close attention is not paid to policy language.

Click here for more information on valuable papers and records coverage. It is a class of property that is often underappreciated by many businesses. It is from Emarketing for Agents found in Advantage Plus.

The litigants disputed one of the situations that is not covered under a valuable papers and records policy. More accurately, they argued over whether the loss situation fell within the categorization of property that was ineligible – property in storage.

Ultimately a high court balanced policy wording vs. its plain meaning. Both parties to a contract have equal rights to expect that the agreement be applied in a fair manner. That often means that words that are not specially defined in a policy retain a common meaning. The higher court determined that finding in favor of the insurance company could only be done by using a tortured meaning of storing and that was not justified.

Click here to see what situations fail to qualify for valuable paper and records coverage. It is from Gordis on Insurance found in Advantage Plus.

Eventually the policyholders that challenged their insurer’s interpretation of stored property were able to secure coverage. Valuable papers and records insurance has a long history of helping businesses recover from losses that could have been crippling.

Whether it is part of commercial property or inland marine forms, it will continue to be viable. However, it does face challenges. Historically, the type of property it protected has, literally, existed in paper (tangible) form. Today and increasingly in the future, that is NOT the case.

Such documents and records now primarily exist electronically. Coverage has changed its focus. One huge issue was that electronic data was commonly excluded when it involved processing functions. Another was that perils that threatened such property tended to be tangible. Again, that has changed as perils presenting the greatest threat have evolved.

Click here for an excerpt from an article involving important considerations regarding valuable paper and records protection. It is excerpted from the May 2012 issue of Rough Notes Magazine found in Advantage Plus.