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Patrick & Christine Mitchell v. Concord General Mutual Insurance Company
Docket No. INS-05-2027, Decision Issued July 25, 2005.

The insureds requested a hearing following receipt of a notice of homeowners insurance cancellation citing a physical change in the property due to the existence of a trampoline. At hearing, the company argued that the policy provides liability coverage and medical payments for persons injured on the premises, and trampoline exposures do not meet the company’s underwriting guidelines. The company representative testified that a letter about the trampoline was sent to the agent and no response was received. Mrs. Mitchell maintained that she was unaware of any problems surrounding the trampoline until she received a letter from the agent stating merely that the company did not like the exposure. She testified that she subsequently received a letter stating that the cancellation action could be resolved if she produced a statement indicating that the trampoline had been removed and would not be replaced.

Held: For the insureds. The applicable statute permits cancellation for “physical changes in the insured property that result in the property becoming uninsurable.” See 24-A M.R.S.A. § 3049(5). The company has not shown that the existence of the trampoline is in fact a change in the property. It is unknown when the trampoline was first established on the property, and it is plausible that the trampoline even existed prior to the inception of the policy. Accordingly, I need not reach the issue of whether the trampoline renders the property uninsurable. Although 24-A M.R.S.A. § 3049(7) permits cancellation for the presence of a trampoline on the insured premises if certain notice requirements have been met, the subject policy does not include § 3049(7) as a reason for cancellation. The company is limited to using only the cancellation grounds articulated in the policy. Although the company also argued that the exposure is related to the insurability of the property, that is not a standard for mid-term cancellation of a homeowners policy.

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