In Ponok Realty Corp. v United Natl. Specialty Ins. Co., the Second Appellate Department affirmed that an insurer was not obligated to defend and indemnify the insured where the insured failed to comply with the notice requirement in the policy. Such notice must be given within a reasonable time in light of all the circumstances when an insurance policy requires that notice of an occurrence be given “as soon as practicable.” Circumstances may excuse or explain the insured’s delay in giving notice, such as a reasonable belief in nonliability. However, the insured has the burden to prove the reasonableness of the excuse.

In this case, the insured’s notice to the insurer more than one year after it received a property damage claim did not meet the policy condition, and its belief of nonliability was neither reasonable nor an excuse for the delay. As such, the insurer was not obligated to defend or indemnify the insured.

See Ponok Realty Corp. v United Natl. Specialty Ins. Co. at http://www.nycourts.gov/reporter/3dseries/2010/2010_00124.htm

Thank you to Jung Lee for this contribution.

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