Buddy Bean Lumber Co. v. Axis Surplus Ins. Co.
Plaintiff filed a claim with its insurer, Axis, after electrical wiring was stolen from its lumberyard. Axis refused to pay the full claim, citing a coinsurance provision in the policy. Plaintiff brought this action seeking to recover under the policy. The court concluded that the proper interpretation of the coinsurance provision depended on whether the insured had filed an actual cash value claim or a replacement cost claim. Here, plaintiff filed a claim with Axis for the actual value of its stolen wire. In order to calculate whether plaintiff was subject to a coinsurance policy on that claim, then, the term "value" in the coinsurance provision should be read as the actual cash value of plaintiff's saw and planing mills. Therefore, plaintiff was not subject to a coinsurance penalty on its claim for the actual value of the stolen wire; plaintiff was entitled to receive its claim of $725,000 less the $100,000 interim payment made by Axis and two undisputed $25,000 deductibles; and plaintiff was entitled to a judgment in the amount of $575,000. Accordingly, the court reversed and remanded. View "Buddy Bean Lumber Co. v. Axis Surplus Ins. Co." on Justia Law