How many proofs of loss can be demanded was a question at the heart of a federal court decision involving a Louisiana hurricane loss litigated in New York under New York law because of a forum-selection and choice-of-law clause buried in the policy. 1 The ruling is a good reminder that procedural traps insurers often rely upon do not always spring the way they hope. This is especially true when it comes to proofs of loss under New York law.
The case arose from hurricane damage in Louisiana, but the insurer successfully enforced a policy provision requiring the dispute to be litigated in New York and governed by New York law. That alone should give every policyholder and public adjuster pause. Where a case is litigated, and which law applies, can dramatically change the rules of the game. In this instance, New York law controlled the insurer’s argument that the claim should be barred because the policyholder failed to submit a “proper” proof of loss.
The insurer’s position was straightforward and aggressive. Yes, the policyholder submitted a sworn proof of loss, but it was labeled “partial,” did not state a final dollar amount, and was tied to an advance payment. According to the insurer, that was not good enough. When the insured later sought additional payment and appraisal without submitting another sworn proof of loss stating a final amount, the insurer argued the entire breach of contract claim should be dismissed.
The court rejected that argument. Under New York law, an insured is generally required to timely submit a signed, sworn proof of loss. Failure to do so can be fatal. But the law does not require multiple proofs of loss unless the policy expressly says so. The court noted that the policy required a signed, sworn proof of loss in the singular. The insured provided exactly that, using the insurer’s pre-filled form, which the insurer required as a condition for issuing a partial payment, and the insurer accepted it without objection.
The court relied on longstanding New York authority holding that once an insurer accepts a sworn proof of loss in connection with a payment, it cannot later insist that the insured was required to submit additional proofs of loss simply because the claim continued to develop or the insured disputed the amount paid. A partial proof of loss is still a proof of loss. New York law favors substantial compliance, not forfeiture by technicality.
Equally important was what the insurer already knew. The record showed the insurer had adjuster estimates, contractor numbers, communications from public adjusters, and a clear statement from the policyholder that the loss exceeded the amounts paid and that policy limits were owed. The idea that the insurer was somehow prejudiced because a second sworn form was not submitted simply did not hold water.
The court also rejected the argument that invoking appraisal required a new proof of loss. The appraisal clause required a disagreement over the amount of loss and not a sworn statement on a particular form. The insured clearly communicated that disagreement. That was enough.
There were other significant issues in this case, including insurable interest and replacement cost disputes, but this post is not about those issues. The proof of loss ruling stands on its own and sends a message insurers should not ignore.
If an insurer demands a proof of loss, supplies the form, requires it to be signed to release payment, and then accepts it, the insurer cannot later pretend that the document never counted, at least under New York law. Labels like “partial” do not magically erase compliance. Policies say what they say, and courts, at least this one applying New York law, will not add extra hurdles after the fact.
To be safe, I am not suggesting that policyholders and public adjusters refuse to provide multiple proofs of loss. The downside to refusing to do so, especially in another state or with facts different than these, may result in a valid denial. Why would anybody say, “Hell no, we won’t file another proof of loss,” and possibly jeopardize a valid claim? What do you have to lose? Ego?
The larger lesson for insurers is one I have preached for years. Proof of loss requirements are meant to facilitate claims handling, not to serve as gotcha clauses. When insurers try to turn them into forfeiture devices, courts often push back.
For those interested in studying the rules about proofs of loss, I suggest reading a trio of posts by Merlin Law Group attorney Corey Harris:
Getting Back to the Basics: What is a Proof of Loss, and What Purpose Does it Serve?
Getting Back to the Basics: What Happens if a Proof of Loss is not Submitted
Getting Back to the Basics: Who may Submit a Proof of Loss and to Whom may it be Submitted?
Thought For The Day
“The spirit of the law, not its letter, is what justice demands.”
— Learned Hand
1 Ram Krishana, Inc. v. Mt. Hawley Ins. Co., No. 1:22-cv-03803, 2025 WL 371016 (S.D. N.Y Feb. 3, 2025).
