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Clearing Things Up: Interpreting Ambiguities in Arizona Policies Property Insurance Blog Coverage



During my years at Merlin Law Group, I have noticed a worrying pattern with insurance companies: denying claims based on confusing and ambiguous policy language. You may be challenging a continuous leak or exclusion of a leak or a protection requirement on your collectibles. It is unlikely that the policy defines "leakage" "leakage" or what qualifies as a protective protection. However, Arizona courts and legislators have clarified the interpretation of these unclear provisions.

Interpretation of insurance contracts is a matter of law. 1 The revised Arizona Statutes require that all insurance policies be construed in accordance with the "Full Terms and Conditions set forth in the Policy." 2 Similarly, Arizona courts interpret policy provisions "according to their simple and ordinary meaning." 3 When a specific provision is susceptible to multiple interpretations, courts will try to discern its meaning by (1

) examining the language of the provision, (2) the purpose of the transaction and (3) general considerations. 4 In other words, "& # 39; the policy must be read as a whole to give a reasonable and harmonious meaning and effect to all its provisions . & # 39;" 5

Courts must "interpret the written terms of [the policy] to effect the intent of the parties" and "to protect the reasonable expectations of the insured." 6 When interpreting policies that are not ambiguous, The court will interpret the policy according to its usual meaning and effect. 7 Courts will examine the language of a person who is not trained in law or insurance business. 8

Uncertainties in the language of insurance will be interpreted against the insurer. 9 If an insurer intends to limit its liability under an insurance policy, it should use language that clearly communicates to the insured about the limitation . 10 "This is especially true where the ambiguity includes an exclusion clause. " 11 When clauses are susceptible to different constructions,

[R] than just finding ambiguity and resorting to contra proferentem doctrine will first try to discern the meaning of the clause" by examining the purpose of the exclusion in question, the general considerations involved and the transaction as a whole. " 12

Essentially, insurance companies bear the burden of showing when a policy exclusion applies. 13

Want to learn more? Stay tuned for an upcoming podcast with Merlin Law Group's attorneys in Arizona.
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1 Liristis v. Am. Family Mut. Ins. Co. 204 Ariz. 140, 61 P.3d 22, 26 (App.2002) (citation omitted).
2 A.R.S. § 20–1119.
3 Sparks v. Republic Nat’l Life Ins. Co. 132 Ariz. 529, 534, 647 P.2d 1127, 1132 (1982).
4 State Farm Mut. Car. Ins. Co. v. Wilson 162 Ariz. 251, 257, 782 P.2d 727, 733 (1989).
5 Gnistor 132 Ariz. At 536, 647 P.2d at. 1134, quotes Fed. Ins. Co. against P.A.T. Homes, Inc. 113 Ariz. 136, 139, 547 P.2d 1050, 1053 (1976).
6 Liberty Ins. Underwriters, Inc. v. Weitz Co. 215 Ariz. 80, 158 P.3d 209, 212 (App.2007) (citations omitted).
7 Mid-Century Ins. Co. v. Duzykowski 131 Ariz. 428, 430, 641 P.2d 1272, 1274 (1982).
8 Gnistor 132 Ariz. At 536, 647 P.2d at. 1132 (1982).
9 Security ins. Co. for Hartford, v. Andersen 158 Ariz. 426, 428, 763 P.2d. 246, 248 (1988) (citations omitted); see also Thomas vs. Liberty Mut. Ins. Co. 173 Ariz. 322, 325, 842 P.2d 1335, 1338 (App. 1992).
10 Coconino County v. Fund Adm & # 39; rs Ass & # 39; n 149 Ariz 427, 431, 719 P.2d 693, 697 (App.1986).
11 Id .
12 Keggi vs. Northbrook Prop. & Cas. Ins. Co. 199 Ariz. 43, 13 P.3d 785 (Ariz. App. 2000) citation Ohio Cas. Ins. Co. v. Henderson 189 Ariz. 184, 186, 939 P.2d 1337, 1339 (1997).
13 Hudnell v. Allstate Ins.Co. 190 Ariz. 52, 54, 945 P.2d 363, 365 (App.1997).


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