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Material misrepresentation in the procurment of the insurance policy is now held to be a precludable defense

Westchester Med. Ctr. v GMAC Ins. Co. Online, Inc., 2011 NY Slip Op 00217 (2d Dept. 2011)

“Moreover, although the defendants contend that they submitted evidence showing that the plaintiff’s assignor misrepresented his state of residence in connection with the issuance of the subject insurance policy, the defendants are precluded from asserting that defense, as a result of their untimely denial of the claim (see Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556, 564; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 319; Westchester Med. Ctr. v Lincoln Gen. Ins. Co., 60 AD3d 1045, 1046-1047).”

This decision raises the question regarding whether certain other “fraudulent” acts on the assignor (or the assignee) are really coverage issues.  Are staged accidents really coverage issues?  Mallela issues?  Did Fair Price (note the above cite) change the calculus on certain issues that we thought were really coverage based?