Gregory v. Safeco Insurance Company of America
Annotate this CaseThe Supreme Court of the State of Colorado has ruled that the notice-prejudice rule applies to occurrence-based, first-party homeowners’ property insurance policies. This rule allows insurance companies to deny coverage based on late notice of a claim only if they can prove they were prejudiced by the delay. The court reached this conclusion after exploring the differences between occurrence policies and claims-made policies, asserting that applying the rule to the former was consistent with precedent. The court's decision was based on three policy considerations: the adhesive nature of insurance contracts, the public policy of compensating victims, and the unfairness of granting the insurer a windfall due to a technicality. This case involved two homeowners, Karyn Gregory and Lisa and Sylvan Runkel, who had filed claims for hail damage to their homes. The insurance companies denied their claims on the grounds that they were filed too late. The court reversed the judgments of the lower courts and remanded the cases for further proceedings, with instructions to allow the insurers an opportunity to establish prejudice from the late notice.
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