The basic operation of an insurance policy is that you pay an insurance company a monetary premium in exchange for its legal obligation to protect, hold harmless, and indemnify you within set parameters. Take a car insurance policy, for instance. You pay a set premium (the amount of which is based upon, among other things, your “riskiness” in incurring legal liability), in exchange for the insurance company’s promise to cover any legal liability up to a certain extent and defend you against same. The same principles apply among most insurance agreements, even legal or medical malpractice insurance.
Missouri courts have held that insurance policies must be interpreted in accordance with traditional rules of contract law. As such, the same laws regarding breach of contract governs insurance policy disputes and their construction. Furthermore, Missouri statutes often effect the interpretation and performance of obligations arising under a given contract. For example, Missouri law enables a plaintiff to seek additional damages if an insurance company vexatiously refuses coverage under the contract.
Contact us with questions regarding insurance policy disputes and breaches.