Rescission Available for Misrepresentation of Material Facts

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Insurance requires that neither party to the contract of insurance do anything to deprive the other of the rights of either to the benefits of the policy. Each must, therefore, treat the other with the utmost good faith. In Edith Darby v. Primerica Life Insurance Company And Ashton Lucian King, Civil Action No. 20-1723 Section “R” (1), United States District Court Eastern District Of Louisiana (May 4, 2021) the insurer moved for summary judgment because the insured and the decedent lied in the application for life insurance.

ZALMA OPINION

Rescission is an ancient equitable remedy that exists so that no one may profit from fraud or misrepresentation or concealment of material facts. Here, the insured and the decedent lied on the application for insurance and it was established that the insurer would never have been issued on the life of Bias because of his drug use and mental disorders. Equity – fairness – required the court to affirm the rescission of the policy.