Property Insurance Vs. St. Paul Fire And Marine Ins Essay

1780 Words Oct 17th, 2016 8 Pages
Fundamentally, property insurance claims are critically distinguishable from liability claims in that property insurance is generally intended only to encompass first-party claims. See Parks Real Estate Purchasing Group v. St. Paul Fire & Marine Ins. Co., 472 F.3d 33, 41 (2006) (citing 2 Ostrager & Newman, Insurance Coverage Disputes § 21.01[a], at 1303 (13th ed. 2006)). This is so, because the subject of a property coverage property is a thing, whereas the subject of a liability policy is a person. Stated differently, as a technical matter of semantics it may be a non sequitur to refer to property claims as “first-or-third party” claims because—contrary to liability policies, where coverage is affixed to a person or “party”—coverage is affixed to property.

In observation of this principle, our authorities require not only that an insured have a contractual right to the coverage they seek, but also that the insured have an insurable interest in the property for which coverage is sought. Accordingly, “[t]he contract of insurance, being one of indemnity, the insured must have such an interest in the property as that its destruction will result in pecuniary loss to him. But it is not necessary he shall have a title, provided his interest, whatever it may be, is such that it would be impaired or injured by its destruction.” Hartford Fire Ins. Co. v. Keating, 86 Md. 130, 148 (1897). Moreover, “[a]n insurable interest exists whenever there is a reasonable degree of probability…

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