George and Inna Botelho owned a high-value home with a roof that had gone badly wrong long before Indian Harbor ever issued a policy. Contractors abandoned the job, the roof remained incomplete for years, and water entered the home every time it rained. That underlying reality framed everything that followed, including the court’s ultimate decision to rule against the policyholders. 1
The court did not deny coverage because rain is not a fortuitous event or because interior water damage can never be covered. In fact, the insurer’s own witnesses conceded that rain and storms are classic chance events. Instead, the entire case turned on what happened before the policy ever took effect, specifically what was said and not said in the insurance application.
When the Botelhos applied for coverage, they answered “no” to a question about whether they planned construction or renovation in the coming year, even though they were actively obtaining bids to fix the roof. They disclosed prior losses in a general way but did not reveal that the roof had been left unfinished and was allowing water to intrude repeatedly. They then signed a statement certifying they were unaware of any circumstances that might give rise to a claim, despite knowing water had been entering the home for years. The court viewed those answers as intentional and material misrepresentations.
Florida law is unforgiving on this point. If an insurance policy contains a concealment or fraud provision, and the insurer proves an intentional, material misrepresentation relating to the insurance, coverage can be voided entirely. To avoid this, the policyholders argued that the insurer inspected the home after binding coverage, saw the incomplete roof, and chose to continue insuring the property. They framed this as a voluntary assumption of risk.
The court rejected that argument. The judge held that a post-binding inspection does not cleanse a false application. His holding was that the law does not reward applicants who misstate material facts and then hope the carrier’s later diligence will save them.
What makes this case particularly sobering is that the court never reached the more nuanced coverage questions. There was no ruling on ensuing loss, faulty workmanship exclusions, actual cash value disputes, or loss of use damages. Once the misrepresentations in the application were established, the rest of the debate became legally irrelevant. Summary judgment was entered, and the case was over.
There is a lesson here for policyholders and for those of us who advise them. Insurance is built on disclosure. Trying to “keep things separate from insurance,” as one insured testified, is a dangerous mindset. Applications matter. Statements of no loss matter. Even well-meaning applicants who follow a broker’s advice to shade the truth can find themselves without coverage when they need it most.
This decision does not mean insurers should get a free pass on bad claims handling, nor does it diminish the importance of holding carriers to their promises. But it does remind us that the foundation of the insurance contract is honesty at inception. Without that, even the strongest coverage arguments can collapse before they are ever heard.
Thought For The Day
“The trust of the innocent is the liar’s most useful tool.”
— Adolf Hitler
1 Botelho v. Indian Harbor Ins. Co., No. 9:24-CV-81400 (S.D. Fla. Jan. 8, 2026).
