Brief Fact Summary.
The home of Thomas and Madeline Mundy (Plaintiffs) was burglarized and valuable silver stolen. Lumberman’s Mutual Casualty Company (Defendant) limited their recovery to $1,000, pursuant to the policy, and they sued to recover the actual value of the property stolen.
Synopsis of Rule of Law.
An insured is bound by the terms of a renewal insurance policy as long as he receives it.
Earlier policies the Mundys had did not contain the $1,000 limit. The Plaintiffs argued that the Company did not give them adequate notice of the change when it sent them the policy renewal, and that its failure entitled them to recover under state law theories of tort, contract, or unfair practice.
The jacket of the new policy contained a notice in all capital letters that the policy contained coverage changes. There were summaries of the changes made, including the following: “Theft of silverware and guns is now limited to $1,000. Should you wish more coverage for such items, contact your agent.”
The district court granted the Company summary judgment, believing the record showed beyond genuine dispute that the notice was adequate.
Were the Plaintiffs bound by the limit in their renewal policy?
· Massachusetts law is clear that the terms of renewal policies are binding, as long as they are received, and a casual reading would have given the Plaintiffs notice of the change.
· The policy’s type and font was readable and in good-sized print, and capital letters and bold font was used to identify changes.
The Plaintiffs were bound by the provision limiting recovery for silverware theft to $1,000, as they received the policy and could have easily read it and noted the change.