Tomorrow is Derby Day in Louisville – time to mix up a batch of mint juleps, get comfortable in front of a big-screen TV, and watch the best horses in America run for the roses.

If you're a bettor, you may lay a wager as well – on Awesome Act, Super Saver, Ice Box, etc.

There's one cardinal rule for betting on a horse: you have to place your bet before the race. Picking the winner afterwards just doesn't happen.

Insurance works somewhat the same way. It will compensate you for a loss, but you have to have the insurance before the loss, not after.

Churchill Downs doesn't allow retroactive betting, and neither does Progressive Classic Insurance.

Believe it or not, a plaintiff took Progressive to court trying to make the company pay for a loss that occurred before the policy in question was purchased. What's worse, Putnam Circuit Judge O.C. Spaulding ruled in favor of the plaintiff.

Terry Daniel bought a car from T.C.'s Used Cars with a loan from Putnam County Bank and purchased six months' coverage from Progressive. Daniel let the policy lapse and demolished his car two days later. The next day, he renewed the policy.

Putnam County Bank filed a claim with Progressive, but the insurance company naturally declined to pay out on a policy not in effect at the time of the crash. T.C.'s Used Cars and the bank together sued Progressive, claiming the company failed to notify Daniel and the bank of its intent to cancel the policy. The policy, of course, had not been canceled by the company, but had been allowed to lapse by the policy holder.

On April 5th, the state supreme court overturned Judge Spaulding's decision, noting that the accident "occurred during a period that coverage did not exist."

Judge Spaulding may be planning to pick a Derby winner on Sunday, but like the rest of us, he will have to get his bet down before post time.

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