An AOB Doesn’t Let You Get Away with Fraud, Florida’s 6th DCA Holds

Most property insurance policies contain ‘Concealment or Fraud’ provisions. As the name suggests, these provisions penalize claimants for material misrepresentations or concealment by releasing insurers from payment obligations, regardless of whether relevant claims would otherwise be covered. Claimants with fully compensable claims, therefore, could lose benefits to which they are entitled because of a consequential lie.

In a recent appeal to Florida’s Sixth DCA,1 SFR Services, LLC, as a post-loss assignee to a homeowner’s insurance benefits, argued that the Concealment or Fraud provision in the policy at issue only applied to policyholders, not to assignees.

The argument was an attempt to challenge an unfavorable jury verdict where the jury had found that while the property loss alleged in SFR’s complaint was covered, coverage was nonetheless voided because SFR had made ‘material misrepresentations . . . in violation of the policy’s Concealment or Fraud provision.’