subject: You Are Required To Advise Your Insurance Company Of Changes Related To Your Coverage [print this page] There are many duties on an insured to maintain your insurance coverage. One firm rule is that the insurance company must always be notified when the number of drivers in a household changes. A recent decision of the Illinois courts shows the application of this rule to one family who was denied coverage.
On an automobile insurance application, an applicant, Mrs. D, was told to report all under age 25 drivers in the home. She told the insurance company that the only operators were husband and herself. When Mrs. D was issued the policy, the conditions stated that the policy could be rescinded if the insured misrepresented any information that could materially affect the risk assumed by the insurance company.
On her application for insurance, Mrs. D allegedly failed to inform the insurance company that her minor son, would be receiving his drivers permit soon. The child was issued a learner's permit a few weeks subsequent to the date the insurance application was submitted. Mrs. D also allegedly failed to inform the insurance company that her son was an operator in her household on subsequent applications to amend the policy for coverage of different vehicles.
He got into two car accidents after the policy was issued, one of which resulted in an injury to one of his passengers. Upon reporting the accident to the insurance company, the coverage was retroactively terminated. A lawsuit was filed after the accident. One part of the suit involved deciding whether it was proper for the insurance company to rescind the policy. The court concluded that the rescission of the policy was warranted because Mrs. D made a material misrepresentation to the insurance company when she failed to name her son as a minor household driver. Pursuant to the decision, the woman received numerous chances to inform of the fact that her son was a driver and also was notified of the consequences of failing to so notify the company.
If you have a new driver in your home, be proactive and inform your insurance company. This case also points out the larger rule that the insured is required to provide full and truthful information in an insurance application or request for renewal of an insurance policy. Rescission of your insurance coverage could result upon your failure to meet this requirement. Call your attorney if you have any questions regarding the terms of your insurance.
This article is intended to present general information for educational purposes, is not legal advice and should not be relied upon in connection with any particular matter. The reader is advised to immediately retain their own separate legal counsel with respect to any specific legal issue. Rights to bring a claim will expire through the passage of time by the applicable statute of limitations.
by: Ralph E. Elliott
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