Digital Commons Network^™

Interpretation And Disclosure In Insurance Contracts, David Schwartz

David Schwartz

This Essay has two goals: one descriptive and one normative. Descriptively, it explicates the connection between interpretation of insurance contracts and the Insurer’s disclosure duty. Disclosure duties and interpretation rules constitute a two way street. The interpretation of insurance contracts by courts, ex post, influences the incentives of insurance companies to disclose information consumers, ex ante. Correspondingly, the scope of ex ante disclosure by insurance companies impacts the willingness of courts to use overwrite insurance contracts by broadly interpreting provision to increase the liability of insurance companies. To illustrate this claim, the Essay discusses the two principal interpretive tools used …