N.J. Court Upholds E & O Without Tail Coverage

[hausdok]

According to a January 17th article in The Insurance Journal a New Jersey court has ruled that a claims-made E & O insurance policy without retroactive (tail) coverage does not violate public policy and is enforceable.

The precedent setting case involved a home inspector who'd declined retroactive coverage when he'd purchased his insurance policy. Later, when the inspector's company was sued for negligence arising from a home inspection performed in 1999, the inspector sought coverage under the inspection company's liability policy, but was denied coverage.

The inspector later sued the insurance company, claiming that a liability policy without retroactive coverage was illegal and violated New Jersey public policy.

The Superior Court of New Jersey for Essex County ruled that the policy did not violate New Jersey public policy. For more details about this case, click here.