March 1, 2011
Today, the Indiana Court of Appeals agreed with "every other court that has addressed" that an insurer is estopped from raising a defense of noncompliance with the terms of a policy if the insurer does not provide the insured of the policy upon request in
Auto-Owners Ins. Co. v. Hughes, Case No. 18A02-1006-PL-65. Nevertheless, the Court ultimately concluded that summary judgment should be granted to the insurer because the evidence showed that it did, in fact, provide a policy upon request. This second point offers lessons regarding the facts to be used in a summary judgment setting.
less..
In March 2002, a fire destroyed Hughes's home, which was insured at the time by Auto-Owners. Among the policy's provisions was a clause stating, "Suit must be brought within one year after the loss or damage occurs." Hughes hired a public adjuster, who requested a copy of Hughes's policy. in January 2003, Auto-Owners denied Hughes's claim. In May 2003, Hughes filed a complaint against Auto-Owners. Auto-Owners moved for summary judgment, arguing that Hughes's suit should be barred by the one-year limitation in the Policy. The trial court denied that motion. A jury awarded damages to Hughes.
On appeal, Auto-Owners challenged the trial court's denial of summary judgment. It recognized that Auto-Owners should be estopped from raising Hughes's noncompliance with the requirement that suit be filed within one year if Hughes requested and did not receive a copy of the policy.
The question before us today is whether principles of equity and fairness create a limited duty to provide a copy of an insurance policy when the insured has requested one following a loss such that failure to discharge that duty would prevent an insurance company from asserting noncompliance with policy terms as a defense in subsequent litigation. We have little trouble answering in the affirmative, as has every other court that has addressed this question.
...
It does not seem too much to ask that an insurance company provide an insured a copy of the policy upon request following a loss, given that there would almost certainly be no other way to procure a copy, and delivery could be accomplished with very little inconvenience or cost to the insurance company. We think that this rule reflects the realities of the typical relationship between an insurance company and an insured, at least when the insured is a private individual. Very few insureds will ever read, much less attempt to understand, their insurance policies, unless, of course, they happen to suffer a loss. We also venture to guess that very few homeowners will ever take the precaution of storing a copy of their policy at a secure location outside of the home, making it that much more likely that a copy will be destroyed in a loss and not be available when needed most. Additionally, this result is consistent with and advances Indiana's strong preference that cases be decided on their merits. We therefore conclude that, following a loss, an insurer must provide a copy of an insurance policy to the insured upon request or be estopped from raising noncompliance with policy terms as a defense in subsequent litigation.
However, the Court concluded that the designated evidence showed that Auto-Owners provided the policy upon request. The public adjuster could not remember receiving a copy of the policy, but this was insufficient to create a genuine issue of material fact.
Lipke testified that he would not dispute that he received the copy of the Policy appearing in his file in April of 2002 if Auto-Owners's records indicated that they sent it to him, and the undisputed designated evidence establishes that it did. Moreover, Lipke testified that he assumed that he did receive a copy of the Policy and that there would be an indication in his file if he had not. Lipke's file contains no such indication. It should also be noted that there is no designated evidence that Lipke ever made another request for a copy of the Policy after April 2, 2002, a further indication that he did receive a copy following his first request. At most, Lipke's testimony indicates a lack of recall regarding receipt of the policy, which is not at all the same thing as denying that he received it; the absence of evidence is not evidence.
The Court's conclusion on the legal question is notable, simply because the Court apparently addresses an issue of first impression in Indiana. However, the manner in which the Court addressed the factual question should serve as a reminder to all litigators that the absence of evidence is not evidence sufficient to demonstrate the absence of a genuine issue of material fact.
Lessons:
- Following a loss, an insurer must provide a copy of an insurance policy to the insured upon request or be estopped from raising noncompliance with policy terms as a defense in subsequent litigation.
- The absence of evidence is not evidence that creates a genuine issue of material fact for the purposes of summary judgment.
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