Airmic technical guide: Reservation of Rights

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A Reservation of Rights is a communication from an insurer which will normally make clear that an insurer's rights are reserved and none of its statements or actions should be understood as waiving its rights to raise for example a defence to a claim under the express wording of the policy or otherwise.

Reservations of Rights are commonly, but not exclusively, issued following notification of a claim or a circumstance.

An insurer will often repeat the Reservation of Rights on the receipt of further correspondence from the insured. Whilst repeating the Reservation of Rights is not obligatory, insurers may adopt this approach to remove any doubts as to their position.

This Airmic paper provides commentary and guidance on avoiding the service of a Reservation of Rights letter, the implications of receiving a Reservation of Rights letter and the actions that should be taken.