(July 12, 2019) In Universal Cable Productions v. Atlantic Speciality Insurance Company, the 9th Circuit Court of Appeals reversed the lower court’s decision which had held that the policy’s war exclusions applied. The decision affirms, at least in California, that words in an insurance policy can have “special meaning” as argued by the policyholder’s attorneys and its insurance expert, Ty Sagalow.

The decision referenced Universal’s insurance expert several times in its decision:

With regard to the record, Universal’s insurance industry expert stated that under insurance industry custom, “an underwriter cannot merge the two concepts and say that ‘an act of terrorism’ can be also an ‘act of war,’” because “if the policy does not contain a terrorism exclusion, there is a reasonable expectation that acts of terrorism by a known terrorist organization, regardless of however else they may be characterized, will be covered.” Atlantic did not rebut this argument; nevertheless, the district court did not consider Universal’s expert testimony regarding the special meaning of “war” in the insurance context. 

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Third, Universal’s unrebutted expert testimony notes that the current customary usage of “war” in the insurance industry was developed gradually after the 9/11 attacks (and related litigation) to distinguish between acts of war and acts of terror in the insurance context. 

To view the full decision click here.