A recent decision by the Minnesota Court of Appeals has provided important clarification on a common issue in property insurance disputes: whether a policyholder’s delay in providing notice of a claim automatically bars coverage.
The case, LaPalme v. Auto-Owners Insurance Company, involved homeowners whose property sustained hail damage in May 2022. Unaware of the damage at the time, the homeowners did not report the loss to their insurer until shortly after the one-year anniversary of the storm. Auto-Owners Insurance denied the claim, citing the policy’s one-year notice requirement.
On appeal, the court held that the notice provision was not a strict condition of coverage. Instead, the insurer must demonstrate that it was prejudiced by the delay in order to deny the claim. In other words, a policyholder’s failure to provide timely notice does not automatically forfeit their right to coverage unless the insurer can show that the delay caused actual harm to its ability to investigate or adjust the claim.
This decision is a significant clarification of Minnesota insurance law, as it corrects a commonly misunderstood basis for claim denial. Notably, SJJ’s own Tim Johnson served as lead counsel through his work with the University of Minnesota Insurance Law Clinic, where he serves as a professor.
The LaPalme ruling reinforces the principle that policy provisions imposing notice deadlines are subject to a prejudice requirement unless explicitly stated otherwise—an important protection for homeowners who may be unaware of damage until well after it occurs.
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