State Auto Prop. & Cas. Ins. Co. v. Hargis, No. 13-5020 (6th Cir. 2015)
Annotate this CaseHargis’s Henderson home was insured by State under a standard homeowner’s policy when it burned to the ground in 2007. No one was home during the fire, but investigations determined that the fire was intentionally set. Hargis filed a claim for $866,000. State paid more than $425,000, including a mortgage payoff of $386,720.34, before alleging that Hargis caused or conspired to cause the fire and falsely inflated the loss in breach of “intentional loss” and “concealment or fraud” policy provisions. Hargis claimed breach of contract and bad faith. State’s investigation eventually led to Hargis’s admission that she had solicited a friend to burn down her house to collect the insurance proceeds. Hargis pleaded guilty to conspiracy to use fire to commit wire fraud and was sentenced to 60 months in prison and ordered to pay restitution totaling $672,497.80, which included $195,116.70 for investigation costs and attorney fees. The district court dismissed a “reverse bad faith” claim, finding certification of the issue unnecessary. The Sixth Circuit affirmed. State did not offer a convincing basis to conclude that the Kentucky Supreme Court would adopt a common law cause of action in tort by an insurer against its insured for breach of the implied duty of good faith and fair dealing.
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.