Did Carrier Properly Disclaim For Misrepresentation on Coverage Application?
In May 2013, Abdus S. Azad, the owner of real property located in Elmhurst, submitted an application to the Kingstone Insurance Company for a fire insurance policy for the property. In the application, Azad represented that the property was a two-family dwelling. Kingstone issued a fire insurance policy to Azad, which was renewed on an annual basis through July 2018.
On May 11, 2018, within the policy period, the property was damaged by a fire. The New York City Department of Buildings, which conducted an investigation, found that the property had been illegally converted to a seven-family dwelling with twenty-three occupants. Shortly thereafter, Azas submitted a notice of claim to Kingstone under the insurance policy. In June 2018, Kingstone disclaimed coverage for the damages caused by the fire and rescinded the insurance policy on the ground that Azad had made a material misrepresentation on his application concerning the use of the property by claiming it was a two-family dwelling.
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