Homeowners Policy Requires Insured to Reside at Premises
Shanice Currie had a homeowners insurance policy with State Auto
Property & Casualty Insurance Company (State Auto). After two fires
severely damaged her duplex in Milwaukee, Currie sought payment from
State Auto. State Auto denied the request for coverage, claiming that
the duplex was not a "residence," and therefore was not covered by the
policy. Currie sued State Auto. The district court granted summary
judgment to State Auto.
In Shanice Currie v. State Auto Property & Casualty Insurance
Company, No. 22-2517, United States Court of Appeals, Seventh Circuit
(July 5, 2023) the USCA for the Seventh Circuit explained the meaning of
the terms "residence premises" and "reside."
BACKGROUND
Currie purchased the previously abandoned duplex (the Property) from the
City of Milwaukee in the spring of 2018. She proceeded to install
electricity and fill the bedroom with a dresser, mirror, clothing, and a
bed. Yet, at the time she acquired the policy the property had no
running water, kitchen appliances, no chairs or sofas in the living
room, or a front door. Where a door should be, there was a wooden board
that Currie would have to unscrew to enter the Property. Strangers came
and went, and Currie took no action to eject them.
Apart from sleeping at the Property two or three nights per month,
Currie did not stay there. She bathed, prepared meals, kept personal
belongings, and received mail at her two other addresses in Milwaukee.
THE POLICY
The homeowners policy Currie purchased from State Auto for the Property
covered “residence premises,” which the policy defined as: “The two-,
three-, or four-family dwelling where you reside in at least one of the
family units . . . on the inception date of the policy period shown in
the Declarations and which is shown as the ‘residence premises’ in the
Declarations.
Because the policy's inception date was September 15, 2018, Currie
needed to reside in one of the units on the Property on that date for
coverage to attach. She did not.
THE FIRES
On October 31 and on November 2, 2018, fires broke out at the Property,
causing extensive damage. Currie informed State Auto that the Property
was a total loss and sought full replacement value. State Auto denied
Currie's claim, explaining that the Property was never her residence.
DISCUSSION
Currie sued. The district court granted State Auto's motion for summary
judgment.
The address was not listed on her driver's license and her mail was sent
to a different location. Most telling, the Property was not secure. It
had no door nor facilities to support normal life.
As a matter of law, Currie's Property was not a residence on the
policy's inception date nor any time before or after. It was not covered
by the insurance policy, and the district court's grant of summary
judgment to State Auto was proper.
ZALMA OPINION
Insurers will issue fire insurance on vacant property but will not do so
on a homeowners policy form. To protect the insurer the homeowners
policy requires the insured to reside on the property. Since the
property was not sufficiently equipped for a person to reside in because
it had no door, no water and no other facilities to support normal
life, Currie failed to fulfill the basic requirement for coverage:
residence. Had the insurer been told the truth about the condition of
the property it would never have agreed to the coverage. Because of the
residence condition there was no need for the insurer to accuse the
insured of fraud.
(c) 2023 Barry Zalma & ClaimSchool, Inc.