Reservation of Rights (ROR)

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Definition - What does Reservation of Rights (ROR) mean?

Reservation of rights (ROR) is a letter sent by the insurer to an insured that informs him or her that the company may not cover a claim. It also announces that the insurer will investigate the soundness of the claim and can advise the insured that he or she may wish to seek out other options for defense regarding a legal action against him or her should the insurer not provide coverage.

Insuranceopedia explains Reservation of Rights (ROR)

An insurer might not provide coverage for several reasons, including:

  • The nature of the loss might not be included in what is covered in the policy.
  • The policy might have already been exhausted after the insurer honored past claims.
  • The loss might be considered to be an exclusion.

Whatever the reason may be, the insurer must explain in the ROR why it might not provide coverage. If the insurer is certain that it will not provide coverage after investigating the facts behind the claim, the insurer then must send the ROR within a specified amount of time in order for the court of law to honor the action as valid.


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