The Rogak Report: 02 Feb 2007 * Homeowner's Insurance - Members of Household *
- RELATIVES WHO LIVE IN HOUSE FULL-TIME WHILE OWNERS LIVE THERE PART
TIME MIGHT BE MEMBERS OF HOUSEHOLD; TRIAL REQUIRED
Auerbach v. Otsego Mut. Fire Ins. Co., 2007 NY Slip Op 00590
(Appellate Division, Second Department)
Otsego Mutual issued a fire insurance policy to Recep Akgun and
Angelina Akgun for a house in Huntington, New York. The plaintiffs,
who are the Akguns' son-in-law and daughter, resided rent-free in the
home, while the named insureds, the Akguns, lived in Florida at the
time of the loss at issue. However, the Akguns had their own bedroom
at the house, kept items of personalty throughout the house, received
mail at that address, were free to stay at the house whenever they
pleased, and in fact stayed at the house at various times for days,
weeks, and even months at a time. After the house was involved in a
fire, the plaintiffs sought to recover under the policy for their
personalty and their additional living expenses. The defendant denied
coverage, asserting that the plaintiffs were not insureds under the
policy because the insured premises was not the Akguns' household
under the policy. Pursuant to the policy, the plaintiffs were deemed
insureds under the policy only if they were residents of the
Supreme Court, Suffolk County, denied Otsego's Motion for summary
judgment. The Appellate Division affirmed.
"If an insurance policy is written in such language as to be doubtful
or uncertain in its meaning, all ambiguity must be resolved in favor
of the insured against the insurer," held the Court, citing Hartol
Prods. Corp. v Prudential Ins. Co., 290 NY 44; Ruder & Finn v
Seaboard Sur. Co., 71 AD2d 216, affd 52 NY2d 663. "The
term 'household' repeatedly has been characterized as ambiguous or
devoid of any fixed meaning (see e.g. Matter of Hartford Ins. Co. of
Midwest v Casella, 278 AD2d 417; General Assur. Co. v Schmitt, 265
AD2d 299; Schaut v Firemen's Ins. Co. of Newark, 130 AD2d 477).
Accordingly, the interpretation of the term requires an inquiry into
the intent of the parties and must reflect 'the reasonable
expectation and purpose of the ordinary business man when making an
insurance contract' and the circumstances of the particular case must
"Here, there is a triable issue of fact as to whether the home in
question was the Akguns' household for the purpose of the insurance
Therefore the issue of plaintiffs' status as members of the insureds'
household requires a trial.
Comment: I don't think this is one that the insurer is going to win.
The plaintiffs are the daughter and son-in-law of the owners, and the
owners come and go as they please, with their own room reserved for
themselves and their own possessions throughout the house. A lot of
ordinary people have arrangements like this. While a lot of
testimony will likely come out about who lives where, and when, the
bottom line is that these people are family, they all live in the
same part of the house, and the term "household" is fuzzy. Even a
tie goes to the insured.