What’s the price of an ambiguous insurance contract? About a billion dollars in the case of Larry Silverstein’s policy over the World Trade Center’s Twin Towers. That’s a billion good reasons to get the fine print right.
Silverstein, the holder of a 99 year lease over the Twin Towers, and a syndicate of insurers that agreed to cover the property, were back in court this week, with both sides continuing their fight over the question whether the September 11 attack on the buildings was one event or two. If the two planes were a single incident, the insurers pay one amount. If the two planes were two separate incidents, the insurers pay a larger amount. The difference? Over a billion US dollars.
The problem? At the time of the attack, the parties had not clearly agreed which policy wording should apply.
In 2004, one jury decided that insurers who had agreed the Wilprop form could rely on wording that defined the attack as a single event. Another jury decided that insurers who didn’t agree the Wilprop form were required to pay out on two events.
Now, both sides are appealing.
It pays to get the fine print right.