Nearly every property insurance policy contains a proof of loss provision which requires the insured to submit a sworn proof of loss. Policies often state,
We will pay within 60 days after we receive your proof of loss and the amount is finally determined by an agreement between you and us, a court judgment or an appraisal award.
In litigation, insurers submit motions for summary judgment asking the court to dismiss an insured’s claim because the insured never submitted a sworn proof of loss. In many cases this is not fatal, and some courts deny these types of motions for summary judgment.1 2
In Colorado, the law has been clear since 1907 that insurers may not rely on failure to submit a proof of loss when the claim has been denied on other grounds. In Hartford Fire Insurance Company v. Hammond, the policy required a signed and sworn proof of loss, which was never furnished. The insurer and insured went to appraisal on the amount of the loss, but were unable to arrive at a settlement. The insurer attempted dismissal of the insured’s claims based on the lack of a proof of loss. The Colorado Supreme Court determined,
The refusal to pay in this case was not because of the absence of this statement or proof of loss, but because it was contended that the insured overestimated the amount of his loss, and, having based the refusal upon grounds other than the absence of the preliminary proof, it is well settled that that objection was waived.3
In fact, Colorado has a long line of cases which support the rule of law that an insurance company that denies a claim based upon specific stated grounds waives its right to later assert additional grounds in litigation.4
Even Where The Policy Contains A Clause Prohibiting Waiver, In Colorado The Insured Is Protected If The Insurer Caused The Non-Compliance
In many cases, an insurance company insists that because the policy contains a clause prohibiting waiver, none can be proven. But despite the specific prohibition of waiver contained in a policy,
[T]he law does not permit an insurance company to avoid liability on account of nonperformance of conditions required by the policy to be performed by the insured where  the conduct of defendant’s agents caused such failure.5
Every policy is different so read your policy language carefully. Notwithstanding the above case law, policyholders should comply with all reasonable obligations under an insurance policy and submit a proof of loss to avoid this fight and potential litigation all together.
1 Laws vary depending on the jurisdiction.
2 Under a NFIP (National Flood Insurance Program) policy, submitting a Proof of Loss is mandatory within 60 days. Failure to submit the form within 60 days is fatal to a claim. The only exception is a letter specifically waiving the requirement, signed by the Administrator of the National Flood Insurance Program.
3 Hartford Fire Ins. Co. v. Hammond, 92 P. 686, 687 (1907).
4 See also Colard v. American Family Mutual Insurance Co., 709 P.2d 11 (Colo. App. 1985); Federal Life Ins. Co. v. Wells, 56 P.2d 936, 98 Colo. 455 (Colo. 1936); Home Ins. Co. of New York v. Taylor, 94 Colo. 446, 32 P.2d 183; Loyal Protective Ins. Co. v. Huffington, 92 Colo. 209, 18 P.2d 1017; Massachusetts Protective Association v. Daugherty, 87 Colo. 467, 288 P. 888; Jennings v. Brotherhood Accident Co., 44 Colo. 68, 96 P. 982, 18 L.R.A. (N.S.) 109, 130 Am.St.Rep. 109; Hartford Fire Ins. Co. v. Hammond, 41 Colo. 323, 92 P. 686; National Mut. Fire Ins. Co. v. Sprague, 40 Colo. 344, 92 P. 227; Atlantic Ins. Co. v. Manning, 3 Colo. 224.
5 Great Am. Ins. Co., New York v. Scott, 299 P. 1051, 1052 ( Colo. 1931).