Can You Sign a Policyholder Release, but Reserve Claims for Additional Damages?

Originally published by Phillip Sanov .

In a case recently decided in the United States District Court for the Eastern District of Texas, the trial court granted summary judgment in the insurance carrier’s favor regarding the policyholder’s lawsuit seeking “additional damages” in a commercial policy fire loss.1 This blog post discusses the court’s ruling, and then addresses points that policyholders should consider prior to signing any release in the insurance carrier’s favor.

Pertinent Facts Outlined In Court’s Decision

During the claim adjustment, the policyholder signed a Policyholder’s Property Damage Release (“the Release”) that stated she accepted the settlement of all claims, but reserved the right to pursue “a supplemental claim for additional damages, if discovered, and to review and revisit the depreciation calculation.”2 Pursuant to a Sworn Statement in Proof of Loss and the Release, the insurance carrier made actual cash value payments of almost $430,000 and withheld $134,296.29…

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