The Right To Waiver

In an article, Alex Mikhalevsky and Brittney Sizemore warn insurers not to make some mistakes based on communications that risk managers should be rooting for. They note that insurance policies provide several tools for investigators and adjusters probing a first-party insurance claim; “However, sloppy investigations, premature denials and failure to act in a timely manner can result in waiver and hamper the insurer’s rights.” They explain that “waiver” refers to the intentional or voluntary relinquishment of a known right. In Georgia, where the authors’ firm is located, defenses against a claim are either “policy” or “coverage” based. Waiver of the insurer’s rights often occurs due to the premature denial of a claim. A policy’s provisions to conduct further investigation is based on the insurer’s communication that a claim is not covered. Once that message is conveyed, the insurer can no longer complete the insured to provide sworn statements, examinations under oath, or other documents that might be useful in litigation. Insureds can seek waiver of contractual suit limitation periods by arguing there is “an affirmative promise or other act waiving the limitation, …actual or constructive fraud,” or the insurer has lulled the insured into believing the “the claim would in fact be paid without suit.”