                    Docket No. 99807.




                     IN THE
                SUPREME COURT
                       OF
              THE STATE OF ILLINOIS



COUNTRY MUTUAL INSURANCE COMPANY, Appellee, v.
    LIVORSI MARINE, INC., et al., Appellants.

                Opinion filed May 18, 2006.



    JUSTICE GARMAN delivered the judgment of the court,
with opinion.
    Chief Justice Thomas and Justices Freeman, McMorrow,
Fitzgerald, Kilbride, and Karmeier concurred in the judgment
and opinion.



                         OPINION
    The circuit court of Cook County granted a declaratory
judgment to Country Mutual Insurance Company, determining
that it had no duty to defend or indemnify the defendant
policyholders in this case. The appellate court affirmed this
decision. 358 Ill. App. 3d 880. We granted defendants= petition
for leave to appeal (177 Ill. 2d R. 315), and now affirm.

                           Background
    Defendants Gaffrig Performance Industries, Inc., and
Livorsi Marine, Inc., each carry commercial general liability
insurance policies with Country Mutual Insurance Company. In
December 1999, Livorsi brought a lawsuit against Gaffrig in the
United States District Court for the Northern District of Illinois.
The suit alleged various trademark violations related to the use
of the AGaffrig Precision Instruments@ name. In response,
Gaffrig filed a lawsuit with similar allegations against Livorsi.
The suits, which sought both damages and injunctive relief,
were consolidated. Gaffrig Performance Industries, Inc. v.
Livorsi Marine, Inc., Nos. 99 C 7778, 99 C 7822 cons. (N.D. Ill.
December 22, 2003).
    The language of both Gaffrig=s and Livorsi=s insurance
policies gives Country Mutual the duty to defend and indemnify
its insureds in any lawsuit seeking damages based on an
advertising injury:
       AWe will pay those sums that the insured becomes
       legally obligated to pay as damages because of
       >personal injury= or >advertising injury= to which this
       coverage part applies. We will have the right and duty to
       defend any >suit= seeking those damages. We may at
       our discretion investigate any >occurrence= or offense
       and settle any claim or >suit= that may result.@
As a condition of coverage, the policies require Gaffrig and
Livorsi to notify Country Mutual of any lawsuit:
       AIf a claim is made or >suit= is brought against any
       insured, you must:
            (1) Immediately record the specifics of the claim or
       >suit= and the date received; and
            (2) Notify us as soon as practicable.
           You must see to it that we receive written notice of
        the claim or >suit= as soon as practicable.@
    Although Gaffrig and Livorsi filed their lawsuits on
December 1, 1999, neither party informed Country Mutual of
the consolidated suit until August 2001.
    Country Mutual then filed a complaint for declaratory
judgment in the circuit court of Cook County. The insurer
sought a judgment that it had no obligation to defend or
indemnify either Livorsi or Gaffrig in connection with the
trademark lawsuit. Country Mutual argued that the claims
raised in the lawsuit did not fit the policy=s definition of
Aadvertising injury@ and that both Livorsi and Gaffrig breached
the notice condition of their policies by failing to inform Country
Mutual of the lawsuits for more than 20 months.
    Testimony during a brief trial centered on telephone
conversations between Michael Livorsi, the owner of Livorsi
Marine, Inc., and Gary Miller, the Country Mutual agent for both
Gaffrig and Livorsi. These conversations concerned the
possibility of a lawsuit between Gaffrig and Livorsi and
occurred prior to the filing of the trademark suit. As the parties
stipulated, Country Mutual did not receive actual notice of the
lawsuit until August 2001, more than 20 months after Gaffrig
and Livorsi filed suit.
    In pretrial and posttrial briefing, Gaffrig and Livorsi argued
that Country Mutual was not prejudiced by the companies=
delay in notifying their insurer of the lawsuit. The companies
argued that because Country Mutual insured both parties, it
had a conflict that would have prevented the insurer from
investigating the claim or defending either party in the lawsuit
over the Gaffrig Precision Instruments trademark. Gaffrig and
Livorsi therefore argued that the insurer would have had to pay
for independent counsel for both parties regardless of when it
received notice, and so the timing of the notice did not
prejudice the insurer. Thus, the delay in notice should not
relieve Country Mutual of its duty to defend. The companies
found support for this argument in a line of cases beginning
with Rice v. AAA Aerostar, Inc., 294 Ill. App. 3d 801 (1998).
The opinion in Rice stated that, AWhen notice of the lawsuit is
the issue, the rule is that the insurer is required to show that it

                               -3-
was prejudiced by the insured=s omission or delay in order to
escape liability on its policy.@ Rice, 294 Ill. App. 3d at 807-08.
    Country Mutual argued that the proper inquiry was not
whether the insurer was prejudiced, but whether the insureds
had given Country Mutual reasonable notice of the lawsuit.
Under other appellate cases, prejudice to the insurer is one of
several factors in assessing the reasonableness of notice. See,
e.g., Northbrook Property & Casualty Insurance Co. v. Applied
Systems, Inc., 313 Ill. App. 3d 457, 466 (2000). Country Mutual
argued that such a lengthy delay, without an excuse from
Gaffrig and Livorsi, was unreasonable as a matter of law. Thus,
this breach of the policies= notice conditions should relieve
Country Mutual of its obligation to defend and indemnify the
companies in their lawsuit.
    The circuit court found that the claims in the federal lawsuit
potentially fell within the insurance policy language covering
advertising injuries, triggering Country Mutual=s duty to defend.
That conclusion is not at issue in this appeal. The court also
determined that Gaffrig and Livorsi failed to give Country
Mutual the notice to which it was entitled. It addressed Gaffrig
and Livorsi=s prejudice argument in the following manner:
       AIn determining an insurer=s liability under the
       circumstances presented here, there is a case to be
       made for considering whether late notice actually
       prejudiced the insurer. However, any such possible
       argument tends to lose its force where there is no
       reasonable justification or excuse offered for not having
       given timely notice ***. In the present case, there has
       been literally no evidence of any justification or excuse
       offered by either of the defendants for a delay of more
       than 21 months in the giving of notice to Country
       Mutual. Under the circumstances, unless the court
       adopts the position that an unambiguous term of a
       contract may not be enforced unless the aggrieved
       party demonstrates some direct harm, there can be only
       one consequence flowing from the facts of this case.@
    Accordingly, the circuit court entered judgment in favor of
Country Mutual. Gaffrig and Livorsi appealed this decision.
Prior to the appellate court=s consideration of the case, the

                               -4-
underlying trademark suit was resolved. The federal court
granted Gaffrig=s request for an injunction against Livorsi=s use
of the disputed trademarks. Gaffrig Performance Industries,
Inc. v. Livorsi Marine, Inc., Nos. 99 C 7778, 99 C 7822 cons.
(N.D. Ill. December 22, 2003). The court did not award
monetary damages to either party. In the absence of damages,
Country Mutual=s duty to indemnify is no longer an issue in this
case. The appellate court therefore addressed only the
insurer=s duty to defend. 358 Ill. App. 3d 880.
    The appellate court premised its decision on two
concessions it concluded could be found in the parties= briefs.
358 Ill. App. 3d at 883. It determined that Gaffrig and Livorsi
conceded that the notice they gave Country Mutual was
unreasonably and inexcusably late. 358 Ill. App. 3d at 883. The
court also determined that Country Mutual conceded that,
because of the conflict of interest, it could not prove it was
prejudiced by the late notice. 358 Ill. App. 3d at 883. Thus, it
framed the issue in the following terms: AGiven the
circumstances presented to us, did Country Mutual have to
prove prejudice?@ 358 Ill. App. 3d at 883.
    The court noted the distinction between notifying an insurer
of an occurrence and notifying an insurer of a lawsuit. 358 Ill.
App. 3d at 885. It determined that when notice of an
occurrence is the issue, courts consider prejudice to the insurer
as one of several factors in the evaluation of whether the
insurer received reasonable notice. 358 Ill. App. 3d at 884.
Additionally, some appellate decisions consider prejudice to the
insurer only when the insured has a good excuse for the late
notice of occurrence or where the delay in notice was relatively
brief. 358 Ill. App. 3d at 885. However, when notice of suit is
the issue, some appellate decisions state that prejudice is
required for the insurer to deny coverage based on late notice.
358 Ill. App. 3d at 885.
    The appellate court then addressed each decision
embracing the latter proposition, beginning with Rice. 358 Ill.
App. 3d 885-87. It noted that Rice was the first case to
distinguish between notice of occurrence and notice of suit,
and that this distinction did not have a basis in Illinois
precedent. 358 Ill. App. 3d at 885. Further, prejudice did not

                              -5-
actually play a role in the Rice court=s decision. 358 Ill. App. 3d
at 886. The court then examined cases citing Rice and
concluded that these cases also did not rely on the Rice dictum
for their holdings. 358 Ill. App. 3d at 886-87. Citing a line of
cases contrary to Rice, it concluded that there is no basis for
distinguishing between notice of an occurrence and notice of a
lawsuit. 358 Ill. App. 3d at 887-88.
     The court found that Country Mutual did not have to prove
prejudice in order to deny coverage. 358 Ill. App. 3d at 888. It
reached the following two conclusions:
             A(1) An insurer=s failure to prove prejudice is a factor
         to consider when determining whether the insured=s
         notice was unreasonably and inexcusably late, whether
         the notice has to do with an occurrence or a lawsuit;
             (2) Once it is determined the insured=s notice was
         unreasonably and inexcusably late, the failure of the
         insurer to prove it suffered prejudice is irrelevant,
         whether the notice has to do with an occurrence or a
         lawsuit.@ 358 Ill. App. 3d at 888.
     Gaffrig and Livorsi petitioned this court for leave to appeal.
We allowed their petition. 177 Ill. 2d R. 315. We granted leave
to file briefs amici curiae in support of Gaffrig and Livorsi to the
Illinois Manufacturers Association, United Policyholders, and
several Illinois businesses. We also granted leave to the Illinois
Insurance Association, Property Casualty Insurers Association
of America, and National Association of Mutual Insurance
Companies to file a brief amicus curiae in support of Country
Mutual.

                        Standard of review
    Gaffrig, Livorsi, and their amici urge this court to adopt the
rule that an insurance company that receives delayed notice of
a lawsuit must prove that it was prejudiced by the delay in
order to be relieved of its duty to defend a policyholder. In
essence, they ask us to establish a new rule of construction for
certain insurance policy notice provisions. This argument
presents a question of law that we review de novo. See
Travelers Insurance Co. v. Eljer Manufacturing, Inc., 197 Ill. 2d

                                -6-
278, 292 (2001) (construction of insurance contract is reviewed
de novo).

                              Analysis
     When construing the language of an insurance policy, a
court is to ascertain and give effect to the intentions of the
parties as expressed by the words of the policy. Central Illinois
Light Co. v. Home Insurance Co., 213 Ill. 2d 141, 153 (2004).
An insurance policy must be construed as a whole, giving
effect to every provision. Central Illinois Light Co., 213 Ill. 2d at
153. If the words used in the policy are unambiguous, they are
given their plain, ordinary, and popular meaning. Central Illinois
Light Co., 213 Ill. 2d at 153. Although insurance policies are
construed liberally in favor of coverage, this rule of construction
comes into play only when the policy language is ambiguous.
Hobbs v. Hartford Insurance Co. of the Midwest, 214 Ill. 2d 11,
17 (2005).
     This court has previously addressed the proper construction
of insurance policy notice provisions. These clauses impose
valid prerequisites to insurance coverage. Barrington
Consolidated High School v. American Insurance Co., 58 Ill. 2d
278, 281 (1974); see also International Harvester Co. v.
Continental Casualty Co., 33 Ill. App. 2d 467, 471 (1962), citing
Imperial Fire Insurance Co. of London v. Coos County, 151
U.S. 452, 38 L. Ed. 231, 14 S. Ct. 379 (1894). A policy
condition requiring notice A[a]s soon as practicable@ is
interpreted to mean Awithin a reasonable time.@ Barrington
Consolidated High School, 58 Ill. 2d at 282. Whether notice
has been given within a reasonable time depends on the facts
and circumstances of each case. Barrington Consolidated High
School, 58 Ill. 2d at 282. Breaching a policy=s notice clause by
failing to give reasonable notice will defeat the right of the
insured party to recover under the policy. Simmon v. Iowa
Mutual Casualty Co., 3 Ill. 2d 318, 322-23 (1954).
     In Simmon, this court discussed the role of prejudice in the
reasonableness analysis. The plaintiff in Simmon had been
injured in an automobile accident by a policyholder of the
insurance company. Simmon, 3 Ill. 2d at 319. She promptly


                                -7-
notified the policyholder=s insurance company of the incident
and of the lawsuit she filed. Simmon, 3 Ill. 2d at 319-20.
Although notice was not given by the insured, the court held
that it does not matter who notifies the insurer, as long as
reasonable notice is given. Simmon, 3 Ill. 2d at 322-23. The
court noted that, when examining the facts and circumstances
of each case to determine if notice was reasonable, Alack of
prejudice may be a factor in determining the question of
whether a reasonable notice was given in a particular case yet
it is not a condition which will dispense with the requirement.@
Simmon, 3 Ill. 2d at 322.
     When presented with an alleged breach of an insurance
policy notice clause, the vast majority of Illinois appellate
decisions have utilized an analysis that is consistent with
Simmon. That is, courts have examined the circumstances of
the case, including the presence or absence of prejudice, and
determined whether the insurer in question received
reasonable notice. See, e.g., Northbrook, 313 Ill. App. 3d at
466; University of Illinois v. Continental Casualty Insurance
Co., 234 Ill. App. 3d 340, 365-66 (1992); Hartford Casualty
Insurance Co. v. Snyders, 153 Ill. App. 3d 1040, 1042-43
(1987); United States Fidelity & Guaranty Co. v. Maren
Engineering Corp., 82 Ill. App. 3d 894, 898 (1980); McFarlane
v. Merit Insurance Co., 58 Ill. App. 3d 616, 619 (1978). When
analyzing whether notice was reasonable, some courts have
stated that prejudice is not a factor unless the delay in notice is
relatively brief or the insured has a good excuse (see, e.g.,
Twin City Fire Insurance Co. v. Old World Trading Co., 266 Ill.
App. 3d 1, 8-9 (1993); Fletcher v. Palos Community
Consolidated School District No. 118, 164 Ill. App. 3d 921, 928
(1987)), although this additional qualification is not found in
Simmon. But even that permutation of the Simmon rule
appropriately locates prejudice as one potential factor in the
reasonableness analysis (see Simmon, 3 Ill. 2d at 322), rather
than as a separate consideration to be reached only if there
has not been reasonable notice. Other factors in the
reasonableness analysis may include the specific language of
the policy=s notice provision, the insured=s sophistication in
commerce and insurance matters, the insured=s awareness of

                               -8-
an event which may trigger insurance coverage, and the
insured=s diligence in ascertaining whether policy coverage is
available. See Northbrook, 313 Ill. App. 3d at 466.
     Illinois courts have generally applied the Simmon analysis
regardless of the type of notice that is at issue. 1 Insurance
policies are likely to contain two different notice conditions: one
that requires notice of the occurrence of an incident which may
fall within the policy=s coverage, and one that requires notice of
any lawsuit stemming from such an incident. When interpreting
notice provisions, most Illinois decisions have not differentiated
between the two requirements. See, e.g., American Family
Mutual Insurance Co. v. Blackburn, 208 Ill. App. 3d 281, 284,
291 (1991) (applying same standard to evaluate delayed notice
of occurrence and notice of suit); Employers Reinsurance
Corp. v. E. Miller Insurance Agency, Inc., 332 Ill. App. 3d 326,
336-37 (2002) (examining several factors to determine whether
notice of suit was given within a reasonable time); American
Home Assurance Co. v. City of Granite City, 59 Ill. App. 3d
656, 658 (1978) (requiring notice of occurrence within
reasonable time based on facts and circumstances of case). In
sum, the Simmon rule has been widely accepted as the proper
analysis for review of all notice requirements contained in
insurance policies.
     Certain recent appellate cases, however, refer to a different
rule. This line of cases begins with Rice v. AAA Aerostar, Inc.,
294 Ill. App. 3d 801 (1998). In Rice, the plaintiff notified the
defendant=s insurer that she had been injured on defendant=s

   1
    We note, however, that notice requirements play a different role in
claims-made policies than in occurrence-based policies such as those at
issue today. See Central Illinois Light Co. v. Home Insurance Co., 213 Ill.
2d 141, 173 (2004) (occurrence-based policies indemnify against claims
occurring in a certain time period, regardless of when claims are made,
while claims-made policies indemnify against claims made during a certain
period, regardless of when underlying incidents occurred). Accordingly,
each type of policy is analyzed differently by Illinois courts. See, e.g.,
Continental Casualty Co. v. Coregis Insurance Co., 316 Ill. App. 3d 1052,
1062-63 (2000) (addressing claims-made policy). Today=s opinion does not
address the role of notice requirements in claims-made policies.


                                   -9-
property, but allegedly failed to notify the insurer of the lawsuit
she subsequently filed. Rice, 294 Ill. App. 3d at 804. The court
distinguished between notice of an occurrence and notice of a
lawsuit, stating that when the latter is at issue, Athe rule is that
the insurer is required to show that it was prejudiced by the
insured=s omission or delay in order to escape liability on its
policy.@ Rice, 294 Ill. App. 3d at 807-08, citing C. Marvel,
Annotation, Modern Status of Rules Requiring Liability Insurer
to Show Prejudice to Escape Liability Because of Insured=s
Failure or Delay in Giving Notice of Accident or Claim, or in
Forwarding Suit Papers, 32 A.L.R.4th 141, 145 (1984).
However, the appellate court did not apply this rule. Instead, it
determined that the insurer failed to show it did not receive
actual notice of the lawsuit, and reversed the circuit court=s
grant of summary judgment. Rice, 294 Ill. App. 3d at 808-09.
    The Rice court did not cite any Illinois precedent in support
of its statement that an insurer must show that it was
prejudiced by a delay in notice of suit. It relied only on a
general annotation. See Rice, 294 Ill. App. 3d at 807-08, citing
32 A.L.R.4th at 145. The annotation in question also does not
cite any Illinois case law to support the rule embraced by Rice.
See 32 A.L.R.4th at 157-71. In fact, the annotation cites
several Illinois cases in support of the proposition that
Aprejudice to a liability insurer is one factor in the determination
of the question of the reasonableness of the insured=s omission
or delay in giving the insurer notice of an accident, or in
forwarding suit papers to it.@ 32 A.L.R.4th at 156, citing
Kenworthy v. Bituminous Casualty Corp., 28 Ill. App. 3d 546
(1975), Rivota v. Kaplan, 49 Ill. App. 3d 910 (1977), American
Home Assurance Co. v. City of Granite City, 59 Ill. App. 3d 656
(1978), and Illinois Valley Minerals Corp. v. Royal-Globe
Insurance Co., 70 Ill. App. 3d 296 (1979). This proposition may
be recognized as the Simmon rule. Simmon, 3 Ill. 2d at 322
(Alack of prejudice may be a factor in determining the question
of whether a reasonable notice was given in a particular case@).
Thus, the Rice court=s ruleBthat an insurer attempting to
escape liability must show it was prejudiced by a policyholder=s
delay in giving notice of a lawsuitBwas completely unsupported
by Illinois precedent and actively contradicted Simmon.

                               -10-
     Nevertheless, subsequent appellate decisions have cited
Rice for its new rule, even if they have not applied it. See Vega
v. Gore, 313 Ill. App. 3d 632, 634 (2000); AAA Disposal
Systems, Inc. v. Aetna Casualty & Surety Co., 355 Ill. App. 3d
275, 284 (2005); Montgomery Ward & Co. v. Home Insurance
Co., 324 Ill. App. 3d 441, 449 (2001); Illinois Founders
Insurance Co. v. Barnett, 304 Ill. App. 3d 602, 611-12 (1999);
Cincinnati Insurance Co. v. Baur=s Opera House, Inc., 296 Ill.
App. 3d 1011, 1018 (1998); Zurich Insurance Co. v. Walsh
Construction Co. of Illinois, Inc., 352 Ill. App. 3d 504, 511
(2004). Although citing Rice, the Vega court apparently
considered prejudice to the insurer as one indicator that the
insurer did not receive reasonable notice of a lawsuit. Vega,
313 Ill. App. 3d at 636. AAA Disposal and Montgomery Ward
dealt with notices of occurrences, and therefore cited the Rice
rule about notice of suit only to determine that it did not apply.
AAA Disposal, 355 Ill. App. 3d at 284; Montgomery Ward, 324
Ill. App. 3d at 449. The court in Illinois Founders mentioned
Rice=s reference to insurer prejudice, but did not rely on
prejudice for its decision, determining instead that the notice
requirement at issue had not been breached. See Illinois
Founders, 304 Ill. App. 3d at 611-12. The court in Zurich
reached a similar result. Zurich, 352 Ill. App. 3d at 511-12. In
Cincinnati Insurance Co., the appellate court found that the
insurer had received reasonable notice, but was nevertheless
prejudiced, and remanded for reconsideration in light of Rice.
Cincinnati Insurance Co., 296 Ill. App. 3d at 1020. Another
case, Household International, Inc. v. Liberty Mutual Insurance
Co., 321 Ill. App. 3d 859 (2001), cited Illinois Founders for the
Rice rule, but did not require that rule for its result because it
found that the excess insurer in question had no duty to
defend. Household International, 321 Ill. App. 3d at 877.
     We will not permit the anomaly of Rice to supersede
decades of case law that accords with this court=s statement in
Simmon. The relevant language in Simmon states not only that
Alack of prejudice may be a factor in determining the question
of whether a reasonable notice was given in a particular case,@
but that lack of prejudice Ais not a condition which will dispense
with the requirement@ of reasonable notice. Simmon, 3 Ill. 2d at

                              -11-
321. Simmon therefore clearly held that even if there is no
prejudice to the insurer, a policyholder still must give
reasonable notice according to the terms of the insurance
policy. This court in Simmon did not distinguish between notice
of an occurrence and notice of a lawsuit, and we decline to do
so today.
      Accordingly, we hold that the presence or absence of
prejudice to the insurer is one factor to consider when
determining whether a policyholder has fulfilled any policy
condition requiring reasonable notice. We also hold that once it
is determined that the insurer did not receive reasonable notice
of an occurrence or a lawsuit, the policyholder may not recover
under the policy, regardless of whether the lack of reasonable
notice prejudiced the insurer. To the extent that Rice and its
progeny contradict our holdings, these cases are overruled.
      However, defendants and their amici do not rely on Rice
alone to argue that this court should adopt a new rule. For
several reasons, they propose varying forms of a requirement
that an insurer must show it was prejudiced by untimely notice
if it wishes to deny coverage based on the breach of a notice
condition. Gaffrig and Livorsi argue that this court should adopt
this prejudice requirement when construing policy conditions
that require timely notice of suit, while their amici argue that we
should adopt a prejudice requirement for breaches of all policy
conditions requiring notice. We do not find the arguments for
either approach to be persuasive.
      First, defendants and their amici argue that adopting a
prejudice requirement would align Illinois with a majority of
states. Many other states do utilize this requirement, an
approach which is frequently known as the Anotice-prejudice@
rule. See Friedland v. Travelers Indemnity Co., 105 P.3d 639,
643 (Colo. 2005). While these states do require a showing of
prejudice for an insurer to escape a policy obligation because
of delayed notice, we note that their case law does not
distinguish between notice of an occurrence and notice of a
lawsuit. See, e.g., Atchison, Topeka & Santa Fe Ry. Co. v.
Stonewall Insurance Co., 275 Kan. 698, 761-62, 71 P.3d 1097,
1139 (2003) (Athis court has not indicated that it would make a
distinction between notice of an occurrence and a suit@); Miller

                               -12-
v. Marcantel, 221 So. 2d 557, 560 (La. App. 1969) (AWe are
unable to discern any logical or functional reason why a
different rule should apply in Louisiana to the delayed notice of
suit, than we now apply to the delayed notice of accident@);
Cooperative Fire Insurance Ass=n of Vermont v. White Caps,
Inc., 166 Vt. 355, 361-62, 694 A.2d 34, 38-39 (1997)
(addressing the purpose of policy provisions requiring notice of
accident, claim, or suit); see generally 32 A.L.R.4th 141, 145
(1984).
    Instead, states that use the Anotice-prejudice rule@ require a
showing of prejudice when an insurer seeks to escape policy
obligations based on any type of delayed notice. In contrast,
the Rice rule endorsed by Gaffrig and Livorsi requires a
showing of prejudice only when the delay at issue is a delay in
notice of suit. Because the Rice rule treats notice of suit
differently than notice of occurrence, the Rice rule is
inconsistent with other states which treat all forms of notice in
the same way. Thus, adopting the Rice rule would create a
new inconsistency between Illinois and its sister states: we
would become unique by treating different types of notice
differently. We see no reason to abandon our own precedent
for a new and unique inconsistency, and therefore Gaffrig and
Livorsi=s argument in favor of consistency fails.
    Defendants= amici make a stronger argument for
consistency by asking us to adopt the notice-prejudice rule for
both notice of occurrence and notice of suit, as other states
have done. However, we are not inclined to adopt a rule that
the parties themselves have not requested.
    Second, defendants and their amici argue that public policy
considerations favor a prejudice requirement. They argue that
the terms of insurance contracts are not freely negotiated, that
public policy favors risk-spreading and compensation of injured
parties, and that an insurer should not receive a windfall based
on a policyholder=s technical violation. Country Mutual and its
amici counter with the argument that it is unfair to impose the
burden of proving prejudice on the insurer when it is
comparatively easy for a policyholder to give notice. They also
argue that requiring insurers to prove prejudice would increase
costs for insurers and the public. We need not address these

                              -13-
policy arguments at great length. Balancing dueling policy
concerns is a more appropriate role for the legislature than for
this court. Cf. Members Mutual Insurance Co. v. Cutaia, 476
S.W.2d 278, 281 (Tex. 1972) (Aon balance, it is better policy for
the contracts of insurance to be changed by the public body
charged with their supervision, the State Board of Insurance, or
by the Legislature, rather than for this Court to insert a
provision that violations of conditions precedent will be excused
if no harm results from their violation@); PAJ, Inc. v. Hanover
Insurance Co., 170 S.W.3d 258, 262 (Tex. Civ. App. 2005)
(explaining regulation that responded to Cutaia).
    However, we do note that the defendant companies= policy
arguments have as a common theme the disparate balance of
power between insurer and policyholder. This theme is not
especially persuasive when the policyholders in the present
case are two sophisticated commercial parties who were
represented by counsel from the inception of the events in
question, particularly when one policyholder contacted the
insurer prior to filing suit and was advised to take steps to
determine if coverage would be available.
    One policy argument bears special attention. Gaffrig,
Livorsi, and their amici argue that the notice-prejudice
requirement would be consistent with the rule this court
adopted in M.F.A. Mutual Insurance Co. v. Cheek, 66 Ill. 2d
492 (1977). In Cheek, we addressed cooperation clauses,
insurance policy conditions which require the policyholder to
cooperate with the insurer. Cheek, 66 Ill. 2d at 498. We held
that unless a breach of the cooperation clause substantially
prejudices the insurer, the insurer cannot rely on the breach to
escape its obligations under the policy. Cheek, 66 Ill. 2d at 498.
Thus, Gaffrig, Livorsi, and their amici ask us to adopt a similar
prejudice requirement for breaches of a policy=s notice clauses.
    For two reasons, we do not find Cheek persuasive in this
case. First, the appellate court in Cheek examined the
differences between the requirements of notice and
cooperation. M.F.A. Mutual Insurance Co. v. Cheek, 34 Ill. App.
3d 209, 218 (1975). Relying on the concern this court
expressed in Simmon for protecting injured third parties, it
found that A[a]n accident victim may provide the notice that an

                              -14-
insured neglects to give his insurer, and may thereby prevent
the insurer from escaping its duty to pay. An accident victim
may not supply the cooperation that an insured fails to give his
insurer, and is completely powerless to remedy the insured=s
breach of the cooperation clause.@ Cheek, 34 Ill. App. 3d at
218. See also Miller v. Dilts, 463 N.E.2d 257, 265 (Ind. 1984)
(addressing differences between notice and cooperation
clauses). Thus, conditions of notice and cooperation are not
entirely similar, and Illinois courts have not treated them
similarly in the past. Second, our opinion in Cheek relied in part
on a collection of Illinois appellate decisions that all relied on
some form of prejudice inquiry. Our decision today is similarly
in accord with the predominant analysis used by the appellate
court, and it is further tied to our own analysis in Simmon.
Cheek does not provide convincing support to alter an
approach widely used by Illinois courts for decades.

                          Conclusion
    Having determined that the circuit court applied the
appropriate rule in this case, we affirm its judgment. Gaffrig
and Livorsi have argued only that this court should adopt the
notice-prejudice rule. They have not argued that the circuit
court misapplied our existing rule. Stated differently, they have
not appealed the circuit court=s conclusion that Country Mutual
did not receive the notice to which it was entitled. Thus, we
express no opinion as to whether the notice in this case was
reasonable. Further, we express no opinion as to whether
Country Mutual was prejudiced by the delayed notice. Instead,
we affirm the circuit court=s legal conclusion that, in the
absence of reasonable notice, Country Mutual is relieved of its
duty to defend the companies.
    The judgment of the appellate court, which affirmed the
judgment of the circuit court, is affirmed.

                                             Judgment affirmed.




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