An insurer faced with a claim that may have been reported in a less than prompt fashion should always, before commencing investigation, reserve its rights in writing or obtain the insured’s signature on a non-waiver agreement so that a thorough investigation may be conducted without concern that the investigation itself will be construed to be a waiver of the limitation period. The reservation of rights letter, if the facts exist, should inform the insured of the policy conditions that may have been breached so that the insured will have the opportunity to explain to his insurer why they were not breached.
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