Inability to void policy ab initio due to misrepresentation leaves uncertainty for auto insurers

By Sara Hart and David Cowley-Salegio ( December 4, 2020, 1:00 PM EST) -- Insurance contracts are contracts requiring the utmost of good faith. At common law, automobile insurers can typically rescind or treat as void ab initio (i.e. from the beginning) an auto insurance policy based on a misrepresentation or material non-disclosure of the insured who is applying for insurance. However, an automobile insurer cannot rescind a contract if it discovers a misrepresentation or non-disclosure on an insurance application after a collision has already occurred. ...
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