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Stephen & Angelia Fowler v. MMG Insurance Company

Held August 14, 2012– Docket No. INS-12-2074
Decision Issued:  August 31, 2012

The named insured requested a hearing to contest the nonrenewal of their homeowners  insurance policy for a woodstove in the garage and a woodstove in the mobile home.  The company did not establish the existence of a woodstove in the garage, and relied only upon its eligibility rules to regarding a woodstove in a mobile home.

Held: For the insured. 24-A M.R.S. § 3051 allows nonrenewal for a reason that is in good faith and related to the insurability of the property. Section 3054 requires the insurer to establish the existence of its stated reason for nonrenewal, and also how it relates to the insurability of the property; specifically providing that “a statement from the insurer that the risk does not meet the insurer's underwriting guidelines alone is not considered sufficient proof or evidence.” The policyholders testified that the garage chimney is attached to an oil furnace. The company offered no explanation as to how a woodstove located in a mobile home (or more specifically, in the stick-built addition adjoining the mobile home) affects the insurability of the property, except that its eligibility rules do not allow it.