Insurance – Fire – Fraudulent Application – Purchase Price – Past Claims

Scottsdale Insurance Co. v. Collins (Lawyers Weekly No. 002-108-12, 10 pp.) (Patrick Michael Duffy, J.) 2:11-cv-02622; D.S.C.

Holding: Although defendant contends he merely answered questions posed to him by an insurance agent and then signed the application that the agent printed out, when he signed the application, defendant asserted that he had read the application and that the statements in it were true. However, the application indicated that the purchase price for the house being insured was $390,000 when defendant knew the purchase price was only $20,000. There is no other plausible explanation for defendant’s misrepresentation regarding the purchase price other than to defraud the plaintiff-insurer.

The insurer’s motion for summary judgment is granted. The policy is void ab initio.

In addition, the application said defendant had made no past insurance claims when in fact he had made or been involved in eight past insurance claims. Even if the insurance agent limited the past-claims question to the previous five years, defendant wrongly answered “none” since he had made one claim in the previous five years.