The question may arise under a policy of insurance – either a homeowners policy or a liability insurance policy – whether a negligent misrepresentation can be an “occurrence” and covered under the policy. It goes without saying that the question of available insurance coverage when claims arise can be very important. Generally there is a split among the jurisdictions as to whether negligent misrepresentation generally constitutes an “occurrence.” Steven Plitt and Jordan R. Plitt, Practical Tools for Handling Insurance Cases, § 13:2(B)(4), pp. 13-28 through 13-30 (Thomson Reuters) (2011 and 2013 Supplement). Those courts holding that negligent misrepresentation does constitute an “occurrence” generally reach one of three conclusions:
For those jurisdictions that hold that negligent misrepresentation is not an “occurrence” they typically find one of the following:
Lawyers must check the law in their states to determine if a negligent misrepresentation is a covered incident.
Source: Claims Journal
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