Carey

BACKGROUND

In 1998, Cook purchased a comprehensive commercial property insurance policy from Caliber One that, among its various terms and conditions, provided $5 million in earth- quake coverage for various buildings Cook owned. In 1999, Cook — through its insurance broker, Crump Insurance Ser- vices, Inc. (“Crump”) — told Caliber One that Cook wanted to renew the policy “under exactly the same terms” as the ini- tial 1998 policy. Contrary to Cook’s asserted intent and appar- ently unbeknownst to it, the 1999-2000 policy Caliber One issued and Cook accepted contained only a $500,000 sublimit for earthquake coverage. Caliber One acknowledges that the reduction in earthquake coverage from $5 million to $500,000 7536 CALIBER ONE INDEMNITY v. CAREY was simply the result of a “clerical error in the preparation of that policy.”

In 2000, Cook sought to renew the policy once again, “on the same terms and conditions” as the 1999-2000 policy. Con- sequently, the mistaken $500,000 earthquake sublimit carried through to the renewal policy. Caliber One gave Cook (through Crump) a quotation confirmation including the $500,000 earthquake sublimit, and Cook “accept[ed] the quote”…