Lit Alerts—April 2018, Vol. 2

Contract Construction: Eastern District of Pennsylvania Dismisses Claim That Insurance Policy Should Be Read as Including Terms from Earlier Policies

In Wescott Electric Co. v. Cincinnati Insurance Co., the Eastern District of Pennsylvania ruled that it would not add terms to an insurance policy even though the terms were contained in a different insurance policy the policyholder had previously purchased from the insurer.

The case centered around an insurance policy covering employee theft that Cincinnati Insurance (Cincinnati) wrote to Wescott Electric (Wescott). Wescott purchased a series of four similar policies from Cincinnati from 2004 to 2013. The first two allowed Wescott to make claims regarding incidents occurring during the policy period as long as they were discovered within one year of the policy expiring. In 2010, when Wescott purchased its third policy, Cincinnati changed the policy language to limit claims to employee theft discovered only during the