Opinion ID: 2045567
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Heading: Twelve-Month Limitation and Proofs of Loss

Text: The homeowner's policy purchased by Margaret Huff contained a provision that no action on the policy could be sustained unless commenced within twelve months after the loss. Another provision required the insured to give immediate written notice followed within sixty days by a signed and sworn proof of loss including an inventory of all damaged property, together with a statement of the actual value of the damaged property. The loss, which is the subject of this suit, occurred in February, 1970. No written notice or verified proof of loss was given to Travelers. Suit was commenced February 28, 1972, two years after the loss was sustained. Admitting that the provisions were not complied with, Huff maintains that there was evidence from which the jury could find that Travelers had waived the limitation period and the requirement of written notice and proof of loss. Travelers contends that the issues of waiver and estoppel are lost to the appellant since neither theory was specially pleaded, citing Emmco Ins. Co. v. Pashas (1967), 140 Ind. App. 544, 224 N.E.2d 314. However, evidence was admitted and the trial court's memorandum in support of its granting judgment to Travelers dealt specifically with both theories. When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings. Ind.R.Tr.P. 15(B). As to the limitation period, contractual limitations on the bringing of actions, such as that involved here, are valid, although not a favorite of the law. Caywood v. Supreme Lodge (1908), 171 Ind. 410, 86 N.E. 482. An insurer may be estopped from asserting or waive such a provision. The conduct or acts on the part of the insurer or its authorized agents must be sufficient to justify a reasonable belief on the part of the insured that the company will not insist on a compliance with the policy provisions. Continental Ins. Co. v. Thornburg (1967), 141 Ind. App. 554, 219 N.E.2d 450. A waiver or estoppel may result from acts of insurer causing insured or claimant under the policy to delay bringing suit until after the time provided for in the policy. 46 C.J.S. Insurance § 1264 (1946). The insurer is not limited to the period contracted for and may choose to pay a claim even though the provision is not complied with. Thus, the inquiry is whether anything has been done in the relationship between the insurer and the insured which would cause the insured to reasonably believe the limitation period will not be insisted upon. Bowler v. Fidelity & Cas. Co. (1969), 53 N.J. 313, 250 A.2d 580; Meekins v. Aetna Ins. Co. (1950), 231 N.C. 452, 57 S.E.2d 777; Dishno v. Home Mut. Ins. Co. (1950), 256 Wis. 448, 41 N.W.2d 375; Perkins v. Cent. Mut. Auto Ins. (1934), 269 Mich. 584, 257 N.W. 891. Requirements of written notice and verified proofs of loss are also valid although easily waived. The standard of waiver is similar to that for limitation periods. It is to be observed, that it is the duty of the insurers, pending the consideration of the proofs of loss, to bear themselves with all good faith towards the claimant, and if they are dissatisfied with the proof furnished, and have, or have not, the right to demand further proof before their liability becomes fixed, they ought to make known to the assured the fact and nature of these demands without unnecessary delay. Aetna Ins. Co. v. Shryer (1882), 85 Ind. 362; accord, Home Ins. Co. v. Day (1929), 90 Ind. App. 128, 168 N.E. 464. Where the insurer or its agents have formed a relationship with the insured or acted towards him in such a way as to cause the insured to reasonably believe written notice and formal proofs of loss will not be required, the insurer will not be permitted to raise such matters as a defense. Slight acts and circumstances may be sufficient for these purposes. Ft. Wayne Ins. Co. v. Irwin (1899), 23 Ind. App. 53, 54 N.E. 817; Germania Fire Ins. Co. v. Stewart (1895), 13 Ind. App. 627, 42 N.E. 286. In this case after the loss was sustained in February, 1970, Mr. Huff gave notification of the loss to Travelers' local agent, from whom Mrs. Huff had purchased the policy. This notification occurred in late February or early March, 1970. The agent told Mr. Huff in reply, to go ahead and get the cost of repairs together and he would process the claim to the company. In May, 1970, Mr. Huff returned with an estimate of the cost of repairs. Mr. Huff thought the estimate high and told the agent he would seek more reasonable repair estimates. From that time until May, 1971, when the agent forwarded a loss report to the company, the two saw each other occasionally, although not on business. Letters were later exchanged with the company. The letters requested further information from the Huffs and the information was later supplied. And there was evidence showing this was the custom in the community for notification of claims against insurance policies. This evidence was sufficient for the jury to find an implied waiver of both the provision limiting the time for suit and the provision requiring formal proofs of loss. One could reasonably conclude that verified proofs of loss were not being insisted upon and that resort to legal proceedings would not be necessary to collect on the claim. Once notice was given and no objection was raised to the mode of documentation and liability was not denied until long after the twelve-month period, then the insurer has waived his right to insist on either provision. To hold otherwise would be to allow an insurer to lull an insured into not pressing his rights and to then deny liability on the basis of the limitation period. It was error to enter a judgment notwithstanding the verdict of the jury on these issues.