Jenner & Block

“7th Circuit Ruling Reveals Broad-Exclusion Risks for Insurers,” Insurance Law Update

In the October Insurance Law Update, Jenner & Block Partner David M. Kroeger and Associate Caroline L. Meneau highlight the Seventh Circuit decision in Crum & Forster Specialty Insurance Co. v. DVO Inc.  DVO argued that the language in its breach of contract exclusion was so broad that the coverage was illusory.  The court agreed with DVO that it had “reasonable expectations” as to the errors and omissions coverage it purchased from Crum.  The court remanded the case to the district court to determine how the contract could be reformed.  “The Seventh Circuit’s decision is useful encouragement for parties to be direct and to-the-point in their contracts,” the authors observe.  The ILU was published by Law360.