Often, when a property insurance claim is reported (even one undisputedly covered) one of the first things many carriers will do is review the application for the policy to see if the insured answered questions either incorrectly or incompletely. This is because Section 627.409 of the Florida Statute allows insurers, in certain limited circumstances, to rescind the policy and prevent the insured from recovering under the contract altogether because of that statement or omission. The relevant provision of the statute states:
Representations in applications; warranties.—
(1) . . . A misrepresentation, omission, concealment of fact, or incorrect statement may prevent recovery under the contract or policy only if any of the following apply:
(a) The misrepresentation, omission, concealment, or statement is fraudulent or is material either to the acceptance of the risk or to the hazard assumed by the insurer.
(b) If the true facts had been known to the insurer pursuant to a policy requirement or other requirement, the insurer in good faith would not have issued the policy or contract, would not have issued it at the same premium rate, would not have issued a policy or contract in as large an amount, or would not have provided coverage with respect to the hazard resulting in the loss.