Disclaimer Letters usually end with a 'catch-all' sentence. It follows a list of specific reasons why the Insurance Company has concluded there is no Coverage for a claim. The catch-all sentence usually goes something like this: 'Nothing in this letter nor any investigation undertaken by or for the Insurance Company waives or is intended to waive any rights of any of the parties to the Insurance Policy.' Ever wonder why Disclaimer Letters have that language, or if this language is any good to actually stand up against a claim of waiver because a provision in the Policy was not specifically mentioned in the Disclaimer Letter?
In a recent decision, a Federal Court in New York has held that similar language in a Disclaimer Letter allowed a Business Owners Property Insurance Company to deny Coverage for a reason that the Insurance Company did not mention in its Disclaimer Letter. Not only did the Insurance Company not mention the particular Policy provision in its Disclaimer Letter, but the applicability of the provision apparently came to light for the first time in the lawsuit that was filed by the Policyholders against the Insurance Company after it disclaimed all coverage. Here is a link to the Official Report: Dalton_v. Harleysville Worcester Insurance Co. (E.D.N.Y. Case No. 05.CV.2020, Opinion Filed July 23, 2007).pdf. This decision is also accessible by subscription at 2007 WL 2120403. A Notice of Appeal was filed on August 16, 2007 and an appeal is apparently still pending in this case. Here is what happened in the Trial Court.
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