35 Claim trends (continued) Coverage denials based on late notice We have recently seen some major court decisions the insurer commonly provides a generic note in the carrier’s favor for denial of coverage based indicating the insurer is reserving all rights under on late notice. Insurance policies have speci昀椀c the policy. This quick response is essential for conditions outlining an insured’s contractual the insured and insurers to begin the process of obligation to report matters. The problem may understanding and trying to mitigate the claim. The become more complex with wording such as “when insurer’s actions could, unintentionally, give the you become reasonably aware of a matter” or insured the impression they have coverage without something similar. The 昀椀rst steps for an insured to the understanding that coverage may respond to reduce or eliminate problems is to understand all some but not all of the allegations. obligations they have under their policies, appoint Ideally, a coverage position within 30–60 days someone within their organization to receive notice of such matters, develop a process/procedure to (based on complexity) is bene昀椀cial to ensure an review, and potentially place all carriers on notice as understanding of how the policy will respond so soon as possible per the policy conditions. the insured can plan accordingly. Unfortunately, we have seen an increase in the length of time to Additionally, depending on the type of notice and receive a coverage position. It is not uncommon to jurisdiction (a lawsuit for example), the response see an insurer take in excess of 120+ days to provide window on a potentially complicated fact pattern a formal coverage evaluation. This time is critical as can be short. Insurers are obligated to act in good the insured could be making decisions (like counsel If an insured doesn’t understand faith, and as such in many circumstances, insurers selection), which directly impacts coverage. their obligations, they should reach will take actions (such as assigning defense counsel or sending a proof of loss). With this initial action, out to their broker and legal counsel for assistance.