Our notes:
If you have a keen eye you may have observed that regulators enjoy ambiguity in their legislative provisions.
When there is regulatory ambiguity the affected parties are at the mercy of the regulators who can put tremendous pressure on these parties to comply with their subjective interpretation of the regulatory provisions.
The affected parties can of course take the matter to the court for their determination. However, the court route is usually not favored as being more costly and time consuming - again favoring the regulators.
The same can also be said of insurance policies. If you see an ambiguity in their wordings and if you point it out to the insurers you will never see them rushing to amend the wordings. It clearly favors the insurers in the face of a multi-million dollar claim which otherwise, with clear policy wording , may become payable forthwith upon proof of claim.
In the case of regulations the affected parties do not have much choice. However, in the case of insurance policies, the insured party could request for an amendment through its brokers before any claim arises which request in itself will put a damper on any effort by the insurance company to rely on that contested provision in the event of a claim.
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