Have you ever sent a text message that was taken completely the wrong way? You type "Fine." meaning, "Yes, that's fine with me," but the person on the other end reads it as "Fine! (I'm secretly furious with you)." It happens all the time. A few simple words, meant to convey one thing, get twisted by the reader's mood, their expectations, or their own agenda.
It’s a small, everyday problem. But in the world of insurance, that same dynamic can have massive consequences. An insurance policy isn’t just a document; it’s a promise. It’s a complex web of words carefully chosen to define exactly what is and isn't covered. The writer of that policy had a specific meaning in mind for every single sentence.
Here’s the thing, though. Not everyone reads it that way. Over the years, I’ve seen that we, as an industry, can sometimes be guilty of committing a few "sins" when it comes to interpreting policy language. These aren't just innocent mistakes; they're habits of thinking that can lead us down a really dangerous path.
So, What Happens When We Stop Reading the Words on the Page?
At its heart, reading an insurance policy should be an exercise in understanding. A fair-minded person—whether they're a claims adjuster, an underwriter, a broker, or a policyholder—tries to grasp what the words actually mean in their plain, ordinary sense. You read the sentence, you understand the definitions, and you apply it to the facts. Simple, right?
But that’s not always what happens. Sometimes, we stop reading what’s there and start looking for what we want to be there. We project our own motives and desires onto the text.
This is where the trouble starts. We fall into two major traps, or what I like to call the two original sins of policy interpretation. One is driven by self-interest, and the other, surprisingly, is often driven by a misguided sense of protection.
The First Sin: Twisting Words to Fit Your Narrative
This one is the most obvious. It’s when someone has a goal in mind—to get a claim paid or to get a claim denied—and they bend, stretch, and contort the policy language until it seems to support their position.
Think of it like a lawyer in a courtroom drama, picking apart a witness's statement. They’re not trying to find the truth; they’re trying to find a loophole. They’re looking for ambiguity where none exists or ignoring context to make a word mean something it was never intended to mean.
I see this from both sides. A policyholder’s attorney might argue that a clear-as-day water damage exclusion doesn't apply because the water was technically vapor before it condensed. On the flip side, an adjuster might seize on a minor policy condition to deny a claim that, in all fairness, should probably be paid.
In both cases, the person isn't trying to understand the policy. They're trying to win. They’re using the policy as a weapon to serve their own ends, and the original, intended meaning of the words gets lost in the battle.
The Trickier Sin: "Fixing" the Policy After the Fact
This second sin is much more subtle, and in my opinion, it can be even more damaging. This is when someone reads a policy and, instead of twisting the words to serve their own agenda, they try to "protect" the writer from consequences they don't think were intended.
Let me tell you a story from early in my career.
I was handling a claim under a pretty standard liability policy. Based on a plain reading of the text, the claim was covered. It wasn't a huge claim, but it was clearly within the scope of the promise we had made to our insured. I was ready to approve it.
But a more senior colleague pulled me aside. He looked at the file and said, "I don't think the underwriters meant to cover this specific scenario. If we pay this, it could open the floodgates for other, similar claims."
He wasn't acting in bad faith. He genuinely thought he was protecting the company from an unforeseen loophole. He was trying to "fix" what he saw as a mistake in the policy's wording by interpreting it in a way that was stricter than what the words themselves actually said. He was imputing a motive—a desire to exclude this type of claim—that simply wasn't there on the page.
He was trying to be a hero, protecting the company from itself. But what he was really doing was breaking a promise. We had sold a policy with specific wording, and now we were trying to backpedal because we were afraid of what that wording might mean down the road.
This is an incredibly tempting sin. It feels responsible. It feels like good risk management. But it’s not. It undermines the very foundation of insurance: that the words in the contract are the final say.
A Call for a Little "Repentance"
So what’s the answer? It’s not about finding new ways to write policies that are somehow immune to misinterpretation. It’s about changing how we approach the ones we already have. It’s a call to "repent," if you will—to turn away from these bad habits and return to a simpler, more honest way of reading.
Here’s what that looks like:
- Read with an open mind. Approach the policy without a preconceived outcome. Don't start by asking, "How can I get this covered?" or "How can I get this denied?" Start by asking, "What do these words actually say?"
- Respect the writer's intent. Assume the people who drafted the policy chose their words carefully and for a reason. The goal is to understand their meaning, not to impose your own.
- Embrace clarity. If the language is clear, follow it. Even if it leads to an outcome you don't like—whether that’s paying a claim you’d rather not, or accepting that your loss isn’t covered.
At the end of the day, an insurance policy is a contract built on trust. And trust is built on the belief that we all mean what we say. When we start twisting words to fit our own needs, that trust erodes. It doesn't matter if we're doing it for selfish reasons or out of a well-intentioned (but misguided) desire to protect someone. The result is the same: the promise gets broken.
The words are all we have. Let's start treating them with the respect they deserve.
