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Recission due to material misrepresentation

Submitted by Jessica Gregory and Carri Leininger on 27 Dec, 2024

An Insured’s misstatement or omission in an application for insurance need not be intentional to prevent recovery under an insurance policy, it must only be material. See Fla. Stat. §627.409. Even if the Insured did not provide the misinformation because the agent completed the application, the Insured is responsible for reviewing the information in the application and verifying that it is correct before signing the application. Florida courts hold that it is generally the duty of a party to a contract to learn and understand its contends before he signs it. See Addison v. Carballosa, 48 So. 3d 951, 954 (Fla. 3d DCA 2010) .

Once an Insured signs an application for insurance they are bound by what is in the written contract, regardless of whether they read it. See People v. Rogers, 104. Fla. 462, 140, So. 205, 208 (1932)(“It is generally the duty of very party to learn and known the contents of a contract before he signs and delivers it.”) The relationship between an insured and insurer is contractual in nature, and the courts of this state have long held that a signatory is bound by a written contract. See Jefferson Ins. Co. v. Fischer, 166 So. 2d 129, 130 (Fla. 1964); See also Citizens Prop. Ins. Corp. v. Eur. Woodcraft Mica Design, Inc., 49 So. 3d 774, 778 (Fla. 4th DCA 2010); Qubty v. Nagda, 817 So. 2d 952, 958 (Fla. 5th DCA 2002); Allied Van Lines, Inc. v. Bratton, 351 So. 2d 344, 347–48 (Fla. 1977).

Therefore, unless there was some active wrongdoing by the agent, a carrier may rescind a policy based upon material misrepresentation in an application signed by the Insured, even if the Insured was unaware of the misrepresentation because the agent completed the application.