Law360 Guest Article: Is Your Insurance Policy’s Limitations Clause Enforceable?


Any insured considering filing suit against its insurer must be aware of potential filing deadlines under the applicable statutes of limitations. The failure to file suit within the applicable deadlines could preclude the insured from being able to pursue its claims. Therefore, at the onset of any dispute with its insurer, an insured must determine what limitations periods apply to each of its potential claims.

Each state has a statutory limitations period for breach of contract claims. These periods vary significantly between the states — ranging from three to 15 years. For example, Texas has a four-year limitations period for breach of contract claims.

States also have statutory limitations periods for extra-contractual claims, including common law bad faith and insurance code violations. Extra-contractual claims may be subject to different limitations periods than contractual claims.

Excerpted from Law360, November 18, 2013. To view full article, click here (subscription required).

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