Quote:
Originally Posted by knight_shadow
To the lawyers:
Is it even necessary to sue Sigma Chi? Couldn't the insurance provider just deny the claim (stating that they were negligent/acting outside of the scope of coverage)?
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There could be a lot of reasons for doing this through a lawsuit - one that comes to mind is that they want to get a court decision on the books that interprets the policy in a certain way. That would have more of a preclusive effect on future claims than a denial of this claim.
Plus, if they have to run their policy language by the insurance commissioner, the company can point to a favorable court decision if they were to write their policies in a certain way that would foreclose coverage on these claims in the future.