P&CNationalmedium
An insurer's claims adjuster, with full knowledge that the insured filed proof of loss 70 days after the loss (10 days late under the policy), processes the claim, conducts an inspection, and pays a partial advance. When the insurer later attempts to deny coverage citing the proof-of-loss timing, the insured's strongest argument to enforce coverage is:
ANovation — a wholly new and separate contract has been substituted in place of the original insurance policy
Waiver — the insurer voluntarily relinquished a known right by investigating and paying the claim
CReformation — the policy must be judicially rewritten to delete the proof-of-loss timing condition
DRescission — the policy is unwound ab initio and treated as though it never came into existence
Why this is the answer
Waiver is the voluntary relinquishment of a known right. When an insurer, with actual knowledge of a coverage defense (here, late proof of loss), proceeds to investigate, adjust, and pay the claim, it has voluntarily relinquished that defense. Estoppel is a related but distinct doctrine — it prevents the insurer from asserting a position when the insured has detrimentally relied on the insurer's conduct. Both can produce the same practical result, but the doctrinal lever in this fact pattern is waiver (knowledge + conduct inconsistent with the right).
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