Ferguson v. Phoenix Assurance Company of New York
Kansas Supreme Court
370 P.2d 379 (1962)
Ferguson (plaintiff) held a burglary policy from Phoenix Assurance (defendant) covering his drug store's safe. Burglars broke in, damaging the premises and stealing narcotics, then cracked the safe's two doors — manipulating the combination on the outer door (leaving no visible marks) and punching out the lock on the inner door (leaving clear marks of force). Ferguson's policy limited safe-burglary coverage to losses where visible tool, explosive, or chemical marks appeared on the exterior of all doors. Phoenix denied coverage for the safe theft because the outer door showed no such marks, even though the inner door plainly did. The trial court awarded Ferguson full recovery plus attorney fees, and Phoenix appealed.
Whether an insurer's assertion of a policy's evidentiary requirement, beyond what is reasonably necessary to prevent fraudulent claims, violates public policy when the totality of the evidence establishes a genuine covered loss.