§ 3.26 Conditions - Concealment, Fraud, and Misrepresentation Provision

• Library: Guide to South Carolina Liability and Property Insurance Law (SCBar) (2019 Ed.)

§ 3.26 Conditions - Concealment, Fraud, and Misrepresentation Provision

In Scottsdale Insurance Co. v. Collins,¹⁴⁵ the court considered the operation of a "Concealment or Fraud" provision, which provided:

C. Concealment Or Fraud

We provide coverage to no person insured under this policy if, whether before or after a loss, one or more persons insured under this policy have:

1. Intentionally concealed or misrepresented any material fact or circumstances;
2. Engaged in fraudulent conduct; or
3. Made false statements relating to his insurance.¹⁴⁶

The insured purchased a six-month "Dwelling and Habitational Fire Policy," which provided coverage for the dwelling in the amount of $390,000 in the event of a total loss. The dwelling was destroyed by fire and the insured filed a claim for the full $390,000. During its investigation of the claim, the insurer discovered the insured had misrepresented material facts in the application concerning past losses and the purchase price of the house.¹⁴⁷

After determining the...