Estoppel

Definition - What does Estoppel mean?

Estoppel refers to the principle of the law that stops someone from making a claim that is contrary to a previous one. That first claim should be earlier pronounced by the court or agreed upon by the parties in a court case. This principle is meant to avoid harassment and abuse in the court.

Insuranceopedia explains Estoppel

If estoppel arises out of inconsistency, then it can also be avoided by consistency. A man cannot claim that he is the father of a child but later on refuses to pay for child support.

The same is true where insurance and estoppel are concerned. An insurance company cannot accept late payments and then later on cancel the policy for late payments. Likewise, it cannot accept late payments by some policyholders and refuse the late payments of other policyholders. These actions might make the court summon the principle of estoppel and puts the insurance company in a bad light.

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