Court Declines to "Create Insurance Coverage Where None Exists" Based on Waiver Argument

On November 14, 2017, the First Department issued a decision in Illinois Union Insurance Co. v. Grandview Palace Condominiums Association, 2017 NY Slip Op. 07957, holding that an insured was not entitled to coverage under a property insurance policy where it failed to satisfy a policy condition -- namely, that the insured "maintain automatic sprinkler systems in complete working order in all buildings in its multi-building condominium complex. The Court rejected the insured's argument that the insurance company had waived the condition or was estopped from asserting it as a defense to coverage, holding that a waiver/estoppel argument could not "create coverage where none exists under the policy."

This decision illustrates the importance of satisfying policy conditions. We have a great deal of experience advising clients regarding insurance coverage issues. If you or a client have a questions regarding the terms of an insurance policy, contact Schlam Stone Partner Brad Nash.