Michigan Supreme Court Upholds Progressive’s Right to Rescind Policy Over Application Misrepresentations
Story Summary
The Michigan Supreme Court has ruled in favor of Progressive, affirming the insurer’s right to rescind a policy following material misrepresentations by a policyholder. The case involved plaintiff Janice Sherman, who provided inaccurate information regarding vehicle garaging and household composition on her application, which would have otherwise increased her premiums by 83%. After a 2021 accident, Progressive denied personal protection insurance benefits and rescinded the policy. While a lower court initially ordered policy reformation, the Supreme Court determined that because Progressive acted without fault and relied on the applicant’s dishonesty, rescission was the appropriate remedy. This decision reinforces the legal expectation of transparency in insurance procurement, protecting insurers from liability when policyholders provide fraudulent information during the application process.
