First up are ghostly policy provisions that few apparently see until the policies reveal themselves at the worst possible time. How many of you are familiar with this little policy poltergeist some clever soul (or committee) slipped into the ISO Commercial Property Conditions form (CP 0090):

A. Concealment, Misrepresentation or Fraud

This Coverage Part is void in any case of fraud by you as it relates to this Coverage Part at any time. It is also void if you or any other insured, at any time, intentionally conceal or misrepresent a material fact concerning:

1 This Coverage Part;

2 The Covered Property;

3 Your interest in the Covered Property;

4 A claim under this Coverage Part.

Slowly read that second sentence again. I'm sure anyone would understand a policy that voids protection for any insured that intentionally concealed or misrepresented a material fact. But how many think that if any insured does so then coverage under this form is voided for all insureds? Pretty scary, kids!

Triple net leases, anyone? Push the entire coverage burden onto the tenant, and just be sure they name me, the landlord, on the tenant's policy as an insured, as my interest may appear. Then let the tenant, inspired by the economy, creatively indulge in liquefying a fixed asset by intentional “rapid oxidation involving flame or glow,” and watch the protection for your interest disappear. Then fail to discover any of this until the time of the claim, and whooohahahahahahahaha!

Just to prove this scenario is not just Hollywood fiction, note that several states have mandated ISO issue state- specific forms modifying that provision in various ways to render it less potentially harmful to innocent insureds. But if you don't want to be awakened by things that go bump in the night, best be sure (a) your state modifies the provision, and (b) you parse the language to ensure silver bullets are used to shoot that vampire. When the claim comes, you don't want that monster gap staggered, you want it deceased.

When it comes to scary language, insurance policies are but one of the beasties lurking in the deep darkness of men's souls. Somewhere between the fourth and sixth circles of Dante's Hell lie the authors of contractual hold-harmless agreements. In past articles, I have opined on why insurance agents who freely offer to review the wording in client contracts to ferret out all the insurance implications should be afraid, very afraid. Many have been those practitioners of the arts who roundly criticized me for such advice, proclaiming it is not only a service but an obligation on the part of any truly professional agent to perform such reviews.

Let me be clear: If you have the background (law) and the expertise (legal training) and the sheer intestinal fortitude to boldly go where even some lawyers refuse to go (unless first lubricated with large doses of compensation), sally forth! But I, like those kids of yesteryear, will be watching you stride confidently toward that closed door of analysis, and as you reach for the knob will leap from the couch screaming “Don't do it, you fool–it's right behind the door!”

And what, prithee, might be just behind that door in our daily world? Perhaps interesting hold-harmless language, similar to my favorite example: the following contractual excerpt cited in an excellent article on such agreements from Bill Wilson at the IIABA Virtual University (the names of have been changed, of course):

To the fullest extent permitted by law, ABC Engineering Inc. agrees to defend, indemnify and save harmless XYZ Construction Inc. and Owner, as well as any other parties, which XYZ Construction is required under the Contract Documents to defend, indemnify and hold harmless, and their agents, servants and employees, from and against any claim, cost, expense or liability (including attorneys' fees), attributable to bodily injury, sickness, disease, or death, or to damage to or destruction of property (including loss of use thereof), caused by, arising out of, resulting from, or occurring in connection with the performance of the work by ABC Engineering Inc., its subcontractors and suppliers, or their agents, servants, or employees, whether or not caused in part by the active or passive negligence or other fault of a party caused by the sole negligence of a party indemnified hereunder. ABC Engineering Inc.'s obligation hereunder shall not be limited by the provisions of any worker's compensation or similar act. ABC Engineering Inc. hereby agrees that One Hundred Dollars and No/Cents ($100.00) of the Price constitutes the separate consideration for ABC Engineering, Inc. indemnity hereunder. Such amount shall be deemed paid out of the first invoice for payment paid hereunder.

Whereas in a previous article I asked you to review this language in detail, here I simply ask you to draw your eye quickly to those phrases in bold. What sick sense of humor calls such a veritable minefield of potential disaster a “hold harmless”? But gosh, Scotty, even though the zombies ate your parents and destroyed Iowa, at least they left you $100 in exchange. Just business, you understand. Michael Corleone sends his respects.

Scary movies, like Halloween parties, can be a stress reliever or an escape from the everyday humdrum of human existence. Sometimes the level of tension can be palpable, like those times around the campfire when those trusty counselors pointed a flashlight under their chins and told tales that left us all needing a change of underwear. Yet the relief always comes when the tale is revealed to be just that–a mere story, a tweaking of our emotions, the terrible roaring demon revealed by the flashlight to be just an overly large barn owl.

In our world of insurance, situations such as the above are all too real, and the resulting sufferings represent real pain and loss, not mere fictions of the dramatic arts. They and other demons like them are the reasons lots of folks out there we call consumers are truly afraid of what will happen to them at claim time. While in the movies folks had Buffy and the Ghostbusters to save them, in our world they hire attorneys.

So what better month than October for us to swear a mighty oath. Seek out the insurance goblins and ghoulies that lurk in our midst. Tear off their masks and shine in the light that reveals them for what they are: opportunities for all of us to first discover their hiding places, then minimize or banish them. In all ways, let's make the world a little less scary for ourselves and those who depend upon us to light the way.

Somewhere out there, I think that Svengoolie would be proud.