John R. Sparks, III, and Carolyn Sparks, His Wife, Plaintiffs-Respondents v. St. Paul Insurance Co., a Corporation…

Summary

The Supreme Court of New Jersey held that St. Paul Insurance's "claims made" professional liability policy, which limited coverage to claims reported during the policy period and provided no retroactive coverage in its first year, violated public policy and the reasonable expectations of insured professionals. The Court construed the policy as analogous to an occurrence policy, granting coverage for negligence occurring during the policy term with timely notice. It affirmed the Appellate Division's judgment and remanded for further determination of the exact scope of coverage.