Mundy v. Lumberman’s Mut. Cas.
783
F.2d 21.
Facts: The plaintiff had an
insurance policy covering burglary. They
were sent a notice that the policy was changing such that the insurance
company’s liability for stolen silver would be limited to $1,000 in the future. They didn’t really look at the notice. Later, there was a burglary and lots of
silver was stolen from them. The
insurance company refused to pay out more than $1,000. The Mundys sued, claiming that they weren’t
given adequate notice of the change in their policy.
Issue: Is the policy change
binding on the Mundys?
Rule: An insured person is bound
by the terms of a renewal policy as long as the person actually receives the
policy.
Analysis: The court finds that the
notice given in the policy itself was quite clear. Holding the Mundys to its contents goes along
with the common law “duty to read”.
Conclusion: The judgment of the lower court
is affirmed.