RTFP – Failure to Read the Full Policy Costs the Insured


Insured’s Failure to Protect His Interest is His Own Worst Enemy for Not Reading Policy

In a case where it was undisputed that the insured admitted he did not read the policy or the numerous policy-renewal notices sent to him from 2006 to 2015 that explicitly set forth the policy limits and explicitly requested that he read them the insured sued for coverage he did not buy. Had he read the policy and notices the insured would have discovered that the policy limit for Coverage B was insufficient and could have, had he desired, requested additional coverage. Mr. Kevin Crook failed to do so and, thus, put himself in danger’s way and had no conscious appreciation of the danger of suffering a monetary loss until it happened.

In Kevin Crook v. Allstate Indemnity Company, The Barker Agency, and Allstate Insurance Company, 1180996, Supreme Court of Alabama (June 26, 2020) Kevin Crook appealed a summary judgment entered by the Tuscaloosa Circuit Court in favor of Allstate Indemnity Company (“Allstate Indemnity”), Allstate Insurance Company (“Allstate Insurance”), and The Barker Agency (hereinafter collectively referred to as “the defendants”) because the language of the policy was clear.


Crook owns lake-front property in Tuscaloosa County. The property consists of a house, a bathhouse, a garage, a deck, and a boat dock. The deck is not directly connected to the house; an exterior stairway connects the house to the deck. The boat dock is, in turn, connected to the side of the deck opposite the stairway and house. A portion of the boat dock is covered with a roof supported by pilings, but the boat dock has no walls.

In 2006, Crook, through The Barker Agency, obtained property insurance on the house and other structures from Allstate Indemnity which was renewed through 2015. Crook admitted, although he was warned to review each renewal of the policy, was not aware of the actual policy limits provided by Allstate Indemnity and did not read the renewal notices. Crook simply trusted that the limits supplied by Allstate Indemnity were exactly what he needed.

On April 14, 2015, a storm damaged the deck and the boat dock; the amount of the damage caused “was at or greater than the coverage provided by” Coverage B. Kevin Smith, a “claims service analyst” inspected the damage reported by Crook. Smith concluded that the deck and the boat dock had been damaged by the storm and that the damage was covered under Coverage B, rather than Coverage A. Accordingly, on April 28, 2015, Allstate Indemnity paid Crook the Coverage B policy limit of $11,455.

Crook sued. Crook alleged that the damage to the deck and the boat dock should have been covered under Coverage A, which has a higher limit of insurance in the amount of $56,049. Concerning Crook’s negligent/wanton-procurement-of-insurance claim, Crook alleged that he relied upon the defendants to provide adequate coverage for the property and that the defendants “knew or should have known that [Coverage B] … would be insufficient to cover damages to [the] deck and [the] boat [dock].”

The circuit court entered a summary judgment in favor of Allstate Insurance as to all claims against it.


The Alabama Supreme Court, like other states, applies the following principles of construction in interpreting an insurance contract:

  1. The rules of contract interpretation are well settled. The issue whether a contract is ambiguous or unambiguous is a question of law for a court to decide.
  2. If a word or phrase is not defined in an insurance policy, then the court should construe the word or phrase according to the meaning a person of ordinary intelligence would reasonably give it. The court should not define words it is construing based on technical or legal terms.
  3. When analyzing an insurance policy, a court gives words used in the policy their common, everyday meaning and interprets them as a reasonable person in the insured’s position would have understood them.
  4. If, under this standard, they are reasonably certain in their meaning, they are not ambiguous as a matter of law and the rule of construction in favor of the insured does not apply.
  5. A policy is not made ambiguous by the fact that the parties interpret the policy differently or disagree as to the meaning of a written provision in a contract.
  6. A court must not rewrite a policy so as to include or exclude coverage that was not intended.
  7. However, if a provision in an insurance policy is found to be genuinely ambiguous, policies of insurance should be construed liberally in respect to persons insured and strictly with respect to the insurer.

The policy issued by Allstate states that Coverage A applies to Crook’s “dwelling including attached structures. Structures connected to your dwelling by only a fence, utility line, or similar connection are not considered attached structures.” It was undisputed that the house is a dwelling and that the deck and the boat dock are structures.

Crook argued that the exterior staircase attaches the deck to the house and that the deck, in turn, which is attached to the boat dock, attaches the boat dock to the house.

The various jurisdictions that have considered the issue determined that Coverage B applies to cover damage to an “other structure” when there is “clear space” between the dwelling and the other structure, even if the dwelling and the damaged other structure are connected by a structure such as a deck.

In the present case, the deck is connected to the house by an exterior staircase. There is a “clear space” between the house and the deck and the boat dock. Neither the deck nor the boat dock is attached to the house. There exists clear space between the structures. Accordingly, applying the plain language of the policy, the circuit court properly determined that the damage to Crook’s deck and boat dock is covered under Coverage B, rather than Coverage A.

The plain language of the policy indicates that Coverage B applies to the deck and the boat dock because those structures are not attached to the dwelling.

It was undisputed that Crook did not read the policy or the numerous policy-renewal notices sent to him from 2006 to 2015 that explicitly set forth the policy limits and explicitly requested that he read them. Had he done so, Crook would have discovered that the policy limit for Coverage B was only $11,455 and could have, had he desired, requested additional coverage. Crook failed to do so and, thus, put himself in danger’s way and should have had a conscious appreciation of the danger of suffering a monetary loss.

The Supreme Court affirmed the circuit court’s summary judgment in favor of Allstate Insurance.


Insurers, like Allstate, always ask their insureds to read the policy, consider the limits provided, and determine if the policy issued provides the coverages needed by the insured. Unfortunately, many, like Mr. Crook, fail to read their policy. Had he done the duty to review the policy when he received it, or the multiple times it was renewed, he would have learned that the coverage for his dock was limited and not sufficient to indemnify him completely if there was a major loss. He did not do so and, rather than accepting the fact that his inaction and inattention to the insurance needed, was the cause of his loss, elected to sue his agent and his insurer for not forcing him to buy more insurance coverage.

© 2020 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant  specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as a

n insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at http://www.zalma.com and zalma@zalma.com.

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

Over the last 52 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

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2 Responses to RTFP – Failure to Read the Full Policy Costs the Insured

  1. Barry – When viewed through the cold lens of the law, there is no question that the insured has the obligation to “know” what they are buying, however, in reality, everyone and particularly the courts should know that the average reasonable person is not like you or me or the judge and attorneys – they don’t read no matter how many times the non speaking policy implores them to “Read me!” And there would be “No need” for and agent if the agent were not performing a valuable service for the purchaser; such as suggesting that the standard 10% limit of coverage B looks like it might not be enough to cover your deck and boat dock.

    You comment on many of these types of cases, and it seems to me in this case, the insured had four problems; a) he failed to read and understand his policy, b) his agent failed to help him read and understand his policy, c) the AL courts had set precedents that determined that additional structures which are connected to the main house are not considered to be “attached” to it unless they are built right off of it like a surrounding deck commonly is, and d) there was no mention of a replacement cost estimate for the deck and dock that might lead to this discussion.

    What would have happened if the insured had sued his agent instead of Allstate?

    • Barry Zalma says:

      Interesting and wise comment. To answer your question, I think, Anthony, that if he sued the agent he would lose unless he could prove the agent was a fiduciary. The court read the policy, because it was called upon to interpret a contract, and did so because the language of the policy – whether read by the insured or not – was clear, unambiguous and easy to read. As as been said for centuries you can lead a horse to water but you can’t make him drink.

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