Opinion ID: 2524899
Heading Depth: 1
Heading Rank: 4

Heading: genuine issue of material fact exists as to when hartford knew of the dispute over the house.

Text: The Rheads claim Hartford had knowledge of a potential dispute between the Rheads and the Afraid of Bears in December of 1990 and continued the policy even with such knowledge. The Rheads' assertion is based on a note written from Idaho Intermountain Claims (IIC) to Hartford indicating knowledge of the possibility of a lack of an insurable interest. The Rheads contend the note was dated December of 1990; however, the note is included in the record and is dated December 24, 1991. Hartford argues it had no knowledge of the dispute until February 22, 1991, when Hartford took a recorded statement of the Rheads. Hartford then conducted an investigation into the Rheads' insurable interest. Hartford retained an attorney to issue an opinion letter regarding the Rheads' interest. In November of 1991, five months after the fire, the opinion letter concluded that the Rheads had no insurable interest in the property at the time of the fire damage as a consequence of failing to remove the house by the date specified by the BIA. The insurer may waive or be estopped from asserting the insurable interest defense where the insurer is aware of the lack of an insurable interest yet issues the policy or continues to recognize the policy upon discovering the lack of an insurable interest. See 3 Couch on Insurance 3D, § 41:8, p. 17. This Court has estopped an insurance company from asserting lack of an insurable interest as a defense where the insurance company had knowledge of the policyholder's intent regarding the coverage. See Boise Ass'n of Credit Men v. U.S. Fire Insurance Co., 44 Idaho 249, 256 P. 523 (1927) (By insuring property, with the knowledge that part of the property belonged to others, the insurers were estopped to deny insurable interest.). The district court found Hartford had no knowledge of the dispute until February 22, 1991, when Hartford took the Rheads' statement. However, Hartford renewed the policy in February of 1991 and continued coverage for the five months after it claims that it knew of the potential lack of an insurable interest. The record is without evidence indicating whether the Rheads believed they were still insured, whether Hartford continued to receive payments from the Rheads while they conducted their investigation, or if Hartford otherwise gave Rheads cause to believe they were still insured which the Rheads relied upon. A genuine issue of a material fact exists as to whether Hartford is estopped or waived the right to deny coverage.