Opinion ID: 1969170
Heading Depth: 1
Heading Rank: 4

Heading: regulatory estoppel

Text: Finally, we conclude that the Superior Court was correct in holding that the insurers are not subject to any regulatory estoppel. Other jurisdictions have held that, notwithstanding the literal terms of an insurance contract, insurers are estopped from interpreting the contract language in a manner inconsistent with prior representations made to insurance regulators. [11] The Superior Court rejected regulatory estoppel in its original opinion and, after remand, concluded that there was no reason to alter its decision. We agree. First, no representations were made to Delaware insurance regulators concerning the application and interpretation of the NMA 1685 provision. Second, regulatory estoppel is inapplicable where, as here, the contract language is clear and unambiguous. [12] Further, we agree with the Superior Court that the public policy rationale for adopting the theory of regulatory estoppel, as advanced by the State in its amicus brief, is unpersuasive. The possibility that the State will have to pay for environmental clean-up if polluters are not covered by insurance is not a valid reason for rewriting or otherwise avoiding the clear terms of a contract.