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Jennifer Simpson v. Vermont Mutual Insurance Company
Docket No. INS-05-2004, Decision Issued June 16, 2005.

The insured requested a hearing following receipt of a notice of homeowners insurance coverage nonrenewal citing the existence of a restricted dog breed and various general conditions of the property. At hearing, the company maintained that the insured’s breed of dog was known for being aggressive and the company was concerned about the potential exposure from a dog bite. The company further noted that a recent inspection of the home raised concerns about certain property conditions. The insured disputed that her dog was dangerous and discussed the work that was being performed on the house.

Held: For the insured. The company’s notice of nonrenewal informed the insured of three separate reasons for this nonrenewal action. None of the reasons appear to trigger any of the cancellation grounds provided in 24-A M.R.S.A. § 3049. Therefore, in order to prevail, the company must demonstrate that one or more of the stated reasons is in good faith and related to the insurability of the property.
Regarding the reason implicating the insured’s dog, the company’s primary argument is that its underwriting guidelines list the insured’s dog as an unacceptable breed. Section 3054 states 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 in a nonrenewal action. Although the company maintained that certain dog breeds are more likely to cause significant injury than others, its evidence did not focus upon the insured’s dog breed. The company has not demonstrated that the insured’s dog presents an increased liability risk.
It is arguable that the portion of the notice citing various general property conditions does not meet the specificity requirement of the statute. See 24-A M.R.S.A. § 3051. Although the inspection report identifies the specific issues, the insured testified that she had not received a copy. Therefore, it is likely that prior to the hearing, the insured was unaware of the company’s specific concerns in these areas. In addition, as the company did not provide a copy of the policy, the level of coverage is unknown. Regarding one of the general cited conditions, it is unclear from the photographs presented whether the condition presents a liability hazard. Further, the company did not explain how that condition impacts the insurability of the property.
The final reason in the notice is poorly worded. The company did not explain what was meant by the wording, and if anything, the wording seems to implicate that the property is more insurable as a result of certain aspects of the property. Accordingly, this reason is also insufficient to allow nonrenewal of the policy.

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