Key Takeaway
New York court rejects insurance rescission under Florida law when insurer failed to provide proper notice and return premiums within reasonable time after discovering fraud.
This article is part of our ongoing choice of law coverage, with 35 published articles analyzing choice of law issues across New York State. Attorney Jason Tenenbaum brings 24+ years of hands-on experience to this analysis, drawing from his work on more than 1,000 appeals, over 100,000 no-fault cases, and recovery of over $100 million for clients throughout Nassau County, Suffolk County, Queens, Brooklyn, Manhattan, and the Bronx. For personalized legal advice about how these principles apply to your specific situation, contact our Long Island office at (516) 750-0595 for a free consultation.
When Insurance Companies Fail to Properly Execute Rescission
Insurance rescission cases often hinge on procedural requirements that insurers must follow to void policies retroactively. This becomes particularly complex when choice of law issues determine which state’s standards apply. In jurisdictions that recognize “void ab initio” rescission — where a policy can be treated as if it never existed — insurers face strict procedural hurdles.
The case of Daily Med. Equip. Distrib. Ctr., Inc. v Allstate Ins. Co. illustrates how insurers can lose their rescission rights by failing to meet fundamental procedural requirements under applicable state law. When Florida law governed the rescission attempt, the insurer discovered that proper notice and premium return obligations are not merely formalities but essential elements of a valid rescission.
Jason Tenenbaum’s Analysis:
Daily Med. Equip. Distrib. Ctr., Inc. v Allstate Ins. Co., 2017 NY Slip Op 50029(U)(App. Term 2d Dept. 2017)
“Inasmuch as defendant’s cross motion papers failed to demonstrate that a rescission notice was sent to the insured, or that defendant had returned, or tendered, all premiums paid to the insured within a reasonable period of time after defendant’s discovery of the grounds for rescinding the policy, defendant failed to show, prima facie, that it had voided the policy ab initio pursuant to Florida law (see W.H.O. Acupuncture, P.C. v Infinity Prop. & Cas. Co., 36 Misc 3d 4, 6-7 , citing Leonardo v State Farm Fire [*2]and Cas. Co., 675 So 2d 176, 179 ). Consequently, defendant’s cross motion for summary judgment dismissing the complaint was properly denied.”
This is the interesting issue we find in these void ab initio jurisdictions. Was the premium returned within a reasonable time after the discovery of the fraud?
Key Takeaway
Under Florida’s void ab initio rescission doctrine, insurers must satisfy two critical procedural requirements: providing proper notice to the insured and returning all premiums within a reasonable time after discovering grounds for rescission. Failure to meet either requirement can invalidate the rescission attempt, leaving the policy in force despite alleged fraud or misrepresentation.
Related Articles
Legal Context
Why This Matters for Your Case
New York law is among the most complex and nuanced in the country, with distinct procedural rules, substantive doctrines, and court systems that differ significantly from other jurisdictions. The Civil Practice Law and Rules (CPLR) governs every stage of civil litigation, from service of process through trial and appeal. The Appellate Division, Appellate Term, and Court of Appeals create a rich and ever-evolving body of case law that practitioners must follow.
Attorney Jason Tenenbaum has practiced across these areas for over 24 years, writing more than 1,000 appellate briefs and publishing over 2,353 legal articles that attorneys and clients rely on for guidance. The analysis in this article reflects real courtroom experience — from motion practice in Civil Court and Supreme Court to oral arguments before the Appellate Division — and a deep understanding of how New York courts actually apply the law in practice.
About This Topic
Choice of Law in New York Insurance & Injury Cases
When an accident or insurance dispute involves multiple states, New York courts must determine which state's law governs the claim. Choice-of-law analysis in New York uses an interest analysis approach for tort claims and a grouping-of-contacts test for contract-based insurance disputes. The choice between New York and another state's law can dramatically affect the outcome — particularly regarding no-fault thresholds, damage caps, and procedural requirements. These articles examine the analytical framework New York courts apply to resolve choice-of-law disputes.
35 published articles in Choice of law
Keep Reading
More Choice of law Analysis
Choice of law?
Court applies New York no-fault law over New Jersey law based on most significant relationship test, despite accident occurring in New Jersey.
Mar 17, 2021Retroactive rescission
A Florida choice of law analysis leads to successful retroactive rescission, highlighting the importance of understanding different state laws in no-fault insurance cases.
Sep 25, 2020Proofs insufficient under PA law
Pennsylvania law allows insurers to rescind policies for misrepresentation, but innocent third parties retain protection rights despite the rescission.
May 4, 2015A primer on Florida Law
Analysis of Florida vs New York no-fault insurance laws, focusing on retroactive policy rescission differences and choice of law implications in cross-state accident cases.
May 29, 2012Interstate Insurance Law Complications in New York Personal Injury Cases
Learn how interstate insurance laws affect NY personal injury cases. Expert analysis of multi-state complications. Call 516-750-0595.
May 12, 2019Massachusetts law applies
Massachusetts law governs no-fault insurance claims with lower PIP limits and health insurance offset provisions, creating expedient claim resolution strategies.
Jul 18, 2016Common Questions
Frequently Asked Questions
How do New York courts decide which state's law applies?
New York follows an 'interest analysis' approach to choice-of-law questions, examining which jurisdiction has the greatest interest in having its law applied. In insurance and personal injury cases, relevant factors include where the accident occurred, where the policy was issued, where the insured resides, and where the insurer is domiciled. Choice-of-law issues frequently arise in cross-border accidents and when out-of-state insurance policies cover New York accidents.
Was this article helpful?
About the Author
Jason Tenenbaum, Esq.
Jason Tenenbaum is the founding attorney of the Law Office of Jason Tenenbaum, P.C., headquartered at 326 Walt Whitman Road, Suite C, Huntington Station, New York 11746. With over 24 years of experience since founding the firm in 2002, Jason has written more than 1,000 appeals, handled over 100,000 no-fault insurance cases, and recovered over $100 million for clients across Long Island, Nassau County, Suffolk County, Queens, Brooklyn, Manhattan, the Bronx, and Staten Island. He is one of the few attorneys in the state who both writes his own appellate briefs and tries his own cases.
Jason is admitted to practice in New York, New Jersey, Florida, Texas, Georgia, and Michigan state courts, as well as multiple federal courts. His 2,353+ published legal articles analyzing New York case law, procedural developments, and litigation strategy make him one of the most prolific legal commentators in the state. He earned his Juris Doctor from Syracuse University College of Law.
Disclaimer: This article is published by the Law Office of Jason Tenenbaum, P.C. for informational and educational purposes only. It does not constitute legal advice, and no attorney-client relationship is formed by reading this content. The legal principles discussed may not apply to your specific situation, and the law may have changed since this article was last updated.
New York law varies by jurisdiction — court decisions in one Appellate Division department may not be followed in another, and local court rules in Nassau County Supreme Court differ from those in Suffolk County Supreme Court, Kings County Civil Court, or Queens County Supreme Court. The Appellate Division, Second Department (which covers Long Island, Brooklyn, Queens, and Staten Island) and the Appellate Term (which hears appeals from lower courts) each have distinct procedural requirements and precedents that affect litigation strategy.
If you need legal help with a choice of law matter, contact our office at (516) 750-0595 for a free consultation. We serve clients throughout Long Island (Huntington, Babylon, Islip, Brookhaven, Smithtown, Riverhead, Southampton, East Hampton), Nassau County (Hempstead, Garden City, Mineola, Great Neck, Manhasset, Freeport, Long Beach, Rockville Centre, Valley Stream, Westbury, Hicksville, Massapequa), Suffolk County (Hauppauge, Deer Park, Bay Shore, Central Islip, Patchogue, Brentwood), Queens, Brooklyn, Manhattan, the Bronx, Staten Island, and Westchester County. Prior results do not guarantee a similar outcome.