The Appellate Term, Second Department, recently issued two decisions of interest, Great Health Care Chiropractic v. Hanover Insurance1 and Universal Health Chiropractic v. Infinity Property & Casualty,2 concerning the retroactive cancellation of an insurance policy based on material misrepresentation in the procurement of the policy.
A common basis for denying a no-fault insurance claim is discovery by the insurer that a material misrepresentation of information was provided by the insured in his policy application. Probably the most commonly alleged misrepresentation is a misstatement as to the insured’s residence and/or garaging of the insured vehicle. Insurers have argued that the location of the insured’s residence and/or garage location of the insured’s vehicle is essential for determining risk, and, in turn, the premium to be charged.3 In fact, some insurers who write policies in only certain states have stated that had they known the insured’s residence and/or vehicle garaging location were not in the particular states where they write policies, they would not have issued a policy at all for that vehicle.4
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