In litigation, if evidence is lost or destroyed intentionally or negligently, what is a potential consequence for the insurer?

• A. The insurer could be found liable.
• B. The insurer’s license is revoked.
• C. The insurer would automatically win.
• D. The incident would be void.

Answer: (A)

When evidence that could affect a case isn’t preserved and is lost or destroyed, it can be treated as spoliation. This triggers judicial sanctions and can lead to adverse inferences against the destroying party, or even more severe penalties. For an insurer, that dynamic means the destruction of material evidence can expose it to liability—often through findings of bad faith, breaches of the duty to defend, or damages awarded to the other party. In short, losing or destroying evidence during litigation can make the insurer liable rather than help it, because it undermines a fair resolution of the claim and signals improper conduct.