Q

We insure a risk that was recently hit by a tornado. After looking into the claim, we found that the insured had rented a second location. This location, used as a warehouse, had been obtained within sixty days prior to the loss. The location had not been added to the policy; however, the insured believes that the location is covered as a “newly acquired location.” We are now having a discussion regarding the definition of “acquired.” Does “acquired” mean to buy, or does it include the renting of property? A common dictionary definition of “acquire” is “to come into possession of: get.” Does “acquire” include an element of control as opposed to outright ownership?

South Carolina Subscriber

A

Absent a specific policy definition of the word “acquired,” the insured is entitled to the most favorable common dictionary meaning. “To come into possession of” does not necessarily connote ownership; it is broad enough to encompass other forms of possession, i.e., renting or leasing, or even borrowing. Additionally, the policy uses the word “acquired” rather than “purchased” or “bought” or some other term meaning acquiring title. As “acquiring” is a broader term than “purchasing,” it is appropriate to include means of obtaining property other than acquiring ownership through purchase. This additional premises should be afforded coverage under the newly acquired property provision.