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Christopher & Louisa Scott v. MMG Insurance Company
Docket No. INS-07-2052, Decision Issued July 2, 2007.

The insureds requested a hearing following receipt of a notice of homeowners insurance coverage nonrenewal citing certain conditions of the property. At hearing, the company presented evidence of the conditions and stated that it had originally given the insureds a certain amount of time to complete other repairs but upon the discovery of two additional hazards, the company decided it could no longer insure the property past the expiration of the policy. The insureds maintained that the company has insured the property for many years with one of the conditions present.

Held: For the company. An insurer may decline to renew a policy for a good faith reason related to the insurability of the property or a cancellation ground pursuant to section 3049. 24-A M.R.S.A. § 3051.

The company has demonstrated that two of the conditions articulated in the notice of nonrenewal exist on the property, and it explained how those conditions are related to the insurability of the property. Although the company issued loss control recommendations regarding the other issues, it is not proposing to decline renewal of the policy based upon those issues. The company proposes to decline renewal of the policy because of two separate conditions of the property. The company has demonstrated that these two conditions are good faith reasons related to the insurability of the property. The company has further demonstrated compliance with the notice requirements of § 3051. The company may decline to renew this policy.