Indemnity Jones and the raiders of the lost policy At the core of every long-tail exposure is the threat of insufficient or nonexistent liability limits. Deep in the past lay the unearthed coverage details that can only be evidenced by the existence of a policy contract. This is more than curiosity; this can mean the difference between financial ruination and financial redemption. When the stakes are this high, you need the services of Indemnity Jones—the insurance archeologist. You might call him an “obtainer of rare antiquities.”
dan corbin, cpcu, cic, lutc Director of research, PIA Management Services
Conceived in 1981, insurance archaeology responded to the first wave of asbestos claims. The late Randolph Fields, an international lawyer, gambler and airline owner, having had homes in Scotland, California and Jersey (Channel Islands), appears to be the architect of this specialized area of insurance consulting. Now, R.M. Fields, an international firm, provides services to agribusiness, airport authorities, brewers, builders, chemical companies, cosmeticians, distributors, dry cleaners, miners, municipalities, plumbing suppliers, power companies, realty companies and refineries. Any time an old occurrence policy can be evidenced to respond to a present claim, these services are invaluable in locating a tangible asset to offset a liability. Obviously, the services of an insurance archeologist would not be needed if the business entity maintained all of its policies (or copies) over the years. Ignorant of toxic torts (“try the local sewer”), latent injuries and environmental damage that were later to manifest themselves, business owners felt no compelling reason to preserve their policies.
Primary evidence Assuming it still exists, the first step is to try to find the expired policy. Archeologists have been clever and resourceful in locating policies in attics, barns, garages, warehouses, underground storage facilities, even the bathroom of an executive’s office. Sometimes, the venue can get nasty; you might even run into snakes. “Asps! Very dangerous.”
Secondary evidence In many cases, the original policy no longer exists (“bad dates”); so the next step is to find secondary evidence that will effectively reconstruct the existence of the policy. Guiding an archeologist at this point will be a competent attorney. There are federal and state rules of evidence to be considered. In general, acceptable testimony will deem the policy lost or destroyed, but the policyholder must not have acted in bad faith to suppress damaging informawww.piatn.com
tion and a diligent effort must have been made to find the policy (e.g., hiring an archeologist). Further, an attorney can determine the burden of proof required for a particular jurisdiction. Will it be the common “preponderance of the evidence” (i.e., more likely than not) standard or the less common “clear and convincing evidence” (i.e., compelling) standard? “I don’t know, I’m making it up as I go.” Another legal issue is the authentication of a document presented as secondary evidence in the attempt to reconstruct a missing policy. It must be classified under the exceptions to the rule of hearsay. A document could be authenticated by having been filed in a public office. In other 13