A Spring windstorm comes through your town, and takes the roof off your garage.

Question

A Spring windstorm comes through your town, and takes the roof off your garage. You're very busy cleaning up tree limbs and other debris, and wait for a contractor to give you a bid on the garage repairs, which takes several days, before dealing with whatever might have happened to your car. You can see that some car windows were blown out, but other than that, it looks OK. In those following days, you get torrential rain as well. When you finally get inside your garage, you find that the rain has all but ruined the interior of your car. Everything is soaking wet, musty, and soiled, and your electrical system is shot.

You call your insurance company, and they send out an adjuster. You're shocked when he says the insurance company won't pay for any of the damage to your car. He said you should have protected it from the rain, and since you didn't, they won't pay.  He advises you to read the clause in your insurance contract titled Mitigation of Damages.

1. Who wins? You or the insurance company? Explain.

2. What if your insurance policy also contained a Liquidated Damages clause, that said the parties agree that coverage for any damage to the interior of the car, for whatever reason and from whatever cause, shall be limited to $5000. Your agent said this is a good deal, since it will keep your premiums low. Would a court uphold such a liquidated damages clause?

Explanation / Answer

In this specific case I am supposed to win as cars are not intended to be parked only in the garage and the insurance company has to pay compensation or anything which is done in a car if it's not direct negligence of the insurer.
In this the specific case everything was related to the act of God which is specifically insured an insurance company has to provide insurance compensation on the damages done in my car.

If the specific limit on the damages case stated on the insurance then there is no doubt that Court would not liquidate the specific damage claus as this clause has been properly understood and signed by you. This type of clause would be an offer which is accepted by me and would not be liquidated by the court by any means.

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