Looks like that case was resolved to the policyholders satisfaction, so not a good example at all. Besides that, the denial was because they were, in actuality, not in compliance with their policy, not because they did something stupid. It was a stupid denial because the violation was extremely in the “well, technically” category, and had nothing to do with the loss.
Okay, I suppose I asked for that, exposing my US-centric thoughts. I meant in the US :).
In the US, insurance covers stupidity. At least once -- your insurer may drop you after they pay out. As long as you don't have an exclusion in the contract covering a particular type of stupidity, and you are not committing fraud, you will be covered.
