In New York, insurers are generally entitled to rescind an insurance policy issued in reliance on a policyholder's material misrepresentations. This provides insurers with an important tool to avoid paying out claims where the policy was issued based on false information in the application. In order to rescind a policy based on misrepresentations in the application, the insurer must demonstrate that the false information was material such that the insurer would not have issued the policy if it had known the misrepresented facts.

In general, materiality is a question for the jury – unless the evidence is clear and substantially uncontradicted. In Travelers Casualty Insurance Company of America vs. BJB Construction Corporation, the Southern District of New York recently held that, in order to demonstrate materiality as a matter of law in the context of a summary judgment motion, an insurer must submit documentary evidence in support of its position.