What must The Computer Store (TCS) demonstrate to overcome the inventory shortages policy exclusion?

To successfully overcome the inventory shortages policy exclusion, The Computer Store (TCS) must establish that the loss is defined by means that are entirely separate from the calculations typically involved in inventory assessments. This can involve providing evidence of theft or damage that does not require relying on the often contentious and scrutinized inventory figures. By demonstrating loss through alternative means—such as physical evidence, police reports, or other documentation that do not depend on inventory counts—TCS can argue more convincingly that the loss is legitimate and should be compensated under their policy.

This approach is significant because inventory computation often can be ambiguous, potentially leading to disputes about the extent of the losses. Therefore, by showing loss independently from inventory records, TCS strengthens their case for claims against the insurer in line with the terms of the policy. In contrast, relying on inventory history or eyewitness testimony may still involve some connection to inventory calculations and might not be sufficient to fully address the policy exclusion. Furthermore, the stipulation regarding the loss amount being under $1,000 is not relevant to overcoming the exclusion but merely relates to the claim's value threshold.