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Insurance Investigation Unambiguously Pays for Itself (NY)

March 10, 2020

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<p style="text-align: justify;">MIC General Insurance Corporation (“MIC”) issued an insurance policy to a client which provided liability coverage for the insured’s “residence premise,” which the contract defined as a dwelling where the insured resides.</p>
<p style="text-align: justify;">After an accident at a property, the insured sought defense and indemnification from MIC for the subsequent personal injury lawsuit.  However, MIC did not accept their insured’s claim at face value and retained a private investigator to look further into the details of the case.  The investigator inspected the home in question and collected a statement from the insured, revealing they actually lived elsewhere.</p>
<p style="text-align: justify;">With this evidence in hand, and after appellate practice, the First Department, in <em><a href="https://www.wcmlaw.com/wp-content/uploads/2020/03/MIC-General-Insurance-Corporation-v.-Campbell.pdf">MIC General Insurance Corporation v. Campbell</a></em>, agreed with MIC’s summary judgment position and ruled there was no coverage to the insured in the first instance, based on the insured’s statement to the investigator.  Moreover, the panel also held the policy’s endorsement modifying “residence premises” from a “one-family dwelling…where you reside” to include three- and four-family dwellings without the phrase “where you reside” was not ambiguous, and read the policy as a whole to extend “where you reside” to apply to all forms of residence premises.</p>
<p style="text-align: justify;">Together, the decision illustrates the merits of exploring doubts in the facts presented in a claim and conducting a thorough investigation, and a reminder that although ambiguities can create coverage, a common sense approach should guide an analysis of whether an ambiguity actually exists at all.</p>
<p style="text-align: justify;">Thanks to Nick Schaefer for his contribution to this post.  If you have any questions or comments, please contact <a href="mailto:vterrasi@wcmlaw.com">Vincent Terrasi</a>.</p>

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