{"id":10854,"date":"2026-06-02T14:30:03","date_gmt":"2026-06-02T14:30:03","guid":{"rendered":"https:\/\/usatrustedlawyers.com\/blog\/court-finds-no-ambiguity-despite-drafting-error-in-policy-language-wiley-rein-llp\/"},"modified":"2026-06-02T14:30:03","modified_gmt":"2026-06-02T14:30:03","slug":"court-finds-no-ambiguity-despite-drafting-error-in-policy-language-wiley-rein-llp","status":"publish","type":"post","link":"https:\/\/usatrustedlawyers.com\/blog\/court-finds-no-ambiguity-despite-drafting-error-in-policy-language-wiley-rein-llp\/","title":{"rendered":"Court Finds No Ambiguity Despite Drafting Error in Policy Language | Wiley Rein LLP"},"content":{"rendered":"\n
\n

A federal district court, applying Indiana law, has held that a sublimit for regulatory claims applied, despite grammatical errors in the policy\u2019s language. HealthtrackRX Indiana, Inc. v. RSUI Indem. Co.<\/em>, 2026 WL 1188702 (E.D. Tex. Apr. 29, 2026)<\/a>.<\/p>\n

The insured, a provider of infectious-disease laboratory testing, was subject to significant regulatory oversight. It received two regulatory claims and sought coverage under its insurance policy. The insurer agreed to fund the defense, but asserted that coverage was subject to both a self\u2011insured retention and an aggregate sublimit of liability for \u201cRegulatory Claims.\u201d The insured filed suit, seeking a declaratory judgment that its defense costs were not subject to either the retention or the sublimit.<\/p>\n

The parties cross-moved for judgment on the pleadings, and the court determined that the two claims were subject to the retention. However, the court did not decide whether the claims were also subject to the sublimit and instead ordered supplemental briefing.<\/p>\n

The relevant sublimit provision at issue stated that the \u201cInsurer\u2019s maximum aggregate Limit of Liability for Loss under this policy in connection with Regulatory Claims made against all Insured\u2019s [sic<\/em>] shall be $250,000.\u201d<\/p>\n

In ruling that the sublimit provision applied, the court rejected the insured\u2019s argument that the erroneous inclusion of an apostrophe in the word \u201cInsured\u2019s\u201d rendered the provision ambiguous and thus unenforceable. The court concluded that the provision, although poorly drafted, was not ambiguous under Indiana law. It determined that the apostrophe in the word \u201cInsured\u2019s\u201d was a typographical error and that the phrase instead should be read as referring to \u201cInsureds.\u201d The court explained that ignoring such an error was appropriate in order to give the necessary effect to the parties\u2019 intent and also to avoid rendering the provision meaningless. Construing the policy as a whole, the court concluded that the only reasonable interpretation was that the sublimit applied to the claims brought against the insured.<\/p>\n

The court also analyzed the meaning of the term \u201call\u201d as used in the sublimit provision and rejected the insured\u2019s proffered interpretation that would require claims to be brought against every possible insured (including all current and future directors, officers, and employees) before the sublimit applied. In so holding, the court explained that such a reading would produce an absurd result and therefore was not reasonable. Instead, the court determined that the provision was best understood as setting an aggregate cap on liability for regulatory claims made against any insured, consistent with the structure and purpose of the policy. Applying that interpretation, the court held that the use of \u201call\u201d did not render the provision ambiguous and concluded that coverage for the insured\u2019s defense costs for the regulatory claims was subject to both the retention and the sublimit.<\/p>\n

[View source<\/a>.]<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

A federal district court, applying Indiana law, has held that a sublimit for regulatory claims applied, despite grammatical errors in the policy\u2019s language. HealthtrackRX Indiana, Inc. v. RSUI […]<\/p>\n","protected":false},"author":1,"featured_media":10855,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[8059,143,1224,8084,674,198,7550,1775,4053,4052],"class_list":["post-10854","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-lawyers","tag-ambiguity","tag-court","tag-drafting","tag-error","tag-finds","tag-language","tag-llp","tag-policy","tag-rein","tag-wiley"],"_links":{"self":[{"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/posts\/10854","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/comments?post=10854"}],"version-history":[{"count":0,"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/posts\/10854\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/media\/10855"}],"wp:attachment":[{"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/media?parent=10854"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/categories?post=10854"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/tags?post=10854"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}