Untimely Notice Prejudices Insurer as a Matter of Law 

Colodny Fass shareholder Amy Koltnow obtained a significant appellate victory for insurers in a case involving a late-reported water back-up claim. The insureds reported the claim over one year after the plumbing had been repaired and the bathroom had been renovated. 

 

Due to the late reporting, the insurance company’s adjuster was unable to determine the cause of the loss or the extent or scope of the damage. The insurer sought a summary judgment arguing as a matter of law the insureds had failed to overcome the presumption that their untimely notice of claim had prejudiced the insurer’s investigation. The insureds presented counter-affidavits from their public adjuster and engineer attesting that the cause of loss could be ascertained. 

 

The trial court granted summary judgment and the appellate court affirmed. The court held that even though there may have been disputed facts as to whether the insurer was prejudiced in determining the cause of the loss, the insureds did not overcome the presumed prejudice from the passage of time in investigating the extent of the loss and cost to repair.