California Court of Appeal

In September 2006, defendant insurance company canceled plaintiff’s medical insurance policy, claiming that plaintiff had made material misrepresentations in her application and concealed that she had undergone a fine needle aspiration for a lump in her breast several days before submitting the application. The cancellation letter expressly stated that defendant was electing to cancel the coverage prospectively rather than rescind the policy. In September 2008, plaintiff filed the underlying lawsuit, alleging that defendant had failed to pay covered claim while the policy was in force. Summary judgment in favor of defendant on grounds that defendant had a right to rescind the policy is reversed, where defendant’s September 2006 decision to cancel, rather than rescind the policy, its affirmation of policy coverage up to that date and assurance that it would pay for services covered prior to cancellation, its retention of plaintiff’s premiums, and its failure to assert a right to rescind until more than two years after it concededly had all the pertinent facts, constituted a waiver of its right to rescind as a matter of law.

Appellate Information

• Decided 03/05/2015
• Published 03/05/2015

Judges

• Manella

Court

• California Court of Appeal

Counsel