Farm Bureau allowed to invalidate homeowners insurance after fire occurs
Stuart Howard experienced a fire in 2006. After paying the claim, Nationwide cancelled his policy. He then bought insurance from Farm Bureau. He claimed that a typewritten Farm Bureau application was prepared by the insurance and merely offered for his signature. After a second fire occurred while Howard was absent, Farm Bureau voided its policy and returned Howard's premium instead of paying for the fire damage. The second fire was caused by a space heater that Howard was using to heat the home because his furnace wasn't operating, and Farm Bureau pointed to entries on his application representing that the furnace in the home was new in 2004.
The appellate court upheld Farm Bureau's recission of the policy, finding that it could be voided because of the misrepresentations in Howard's application. It noted that even if he accurately recounted how the application came to be false, it was his signature at the bottom, making him responsible for the false statements. The judges also went to great length to document the particulars of the three-page application that should have alerted Howard to his duty to review and correct any mis-statements in the three page document.