Glossary

Reservation of rights

A written notice that an insurer is investigating or paying a claim but keeps the option to deny coverage or limit payment later if the facts warrant it.

Also called: reservation of rights letter, ROR letter, ROR

A reservation of rights letter tells you the insurer is handling a claim while keeping the right to decline coverage, in whole or in part, if the facts show an exclusion or condition applies. It usually names the provisions in question, such as a water exclusion, late notice, a vacancy clause or possible misrepresentation, and states that investigating, paying part of the claim or hiring an expert does not waive those rights.

It is not a denial. Reservations are common in liability claims, where the insurer defends a lawsuit under a reservation. In some states that can entitle you to choose independent defense counsel at the insurer's expense. In a property claim, a reservation signals a coverage question, often about the cause or timing of the damage, and frequently comes with a request for records or an examination under oath.

Read the letter in full and calendar every deadline in it. Keep cooperating, answer requests in writing, and correct any facts it gets wrong. Do not sign a release or a "non-waiver agreement" without understanding it. If the sums are large, a coverage attorney is worth a consultation. The insurer must still follow the claim-handling rules in your state's unfair claims settlement practices law, and a reservation is not a reason for it to stop investigating promptly.

Last reviewed October 10, 2026

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Related terms

Exclusion A policy provision that removes coverage for a stated cause, type of loss, property or circumstance that the coverage would otherwise reach. Examination under oath A formal, recorded question-and-answer session under oath that an insurer can require of a claimant, usually led by the insurer's attorney. Bad faith An insurer's unreasonable claim handling, such as denying or delaying payment with no reasonable basis, that can bring damages beyond the policy benefits. Adjuster The person who investigates a reported loss, decides what the policy covers and how much it will pay, and negotiates the settlement. Duties after loss The steps a homeowners policy requires after damage occurs: reporting it, protecting the property, documenting the loss and cooperating with the insurer.

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