Auto-Owners Ins. Co. v. Second Chance Invs., LLCAnnotate this Case
Second Chance Investments, LLC (SCI) purchased a fire insurance policy from Auto-Owners Insurance Company (Auto-Owners) that covered a building with the limit of insurance set at $2,095,500. The building subsequently suffered extensive fire damage. SCI filed a proof of loss claiming the building was a total loss. Auto-Owners rejected the proof of loss, contending that it did not state the actual cash value of the loss as required by the policy or provide a written estimate of repair to support the claim. After a continued dispute over whether the property was a total loss, Auto-Owners ultimately filed a complaint in district court seeking an order compelling SCI to submit the issue of whether the building was a total loss to a binding determination by an appraisal panel. The district court denied Auto-Owners' motion to compel appraisal and dismissed its complaint. The court of appeals affirmed, concluding that a court, rather than an appraisal panel, is the appropriate forum to determine whether the property suffered a total loss. The Supreme Court affirmed, holding that a party to a fire insurance policy does not have the statutory right to have an appraisal panel decide whether a claim involves a total loss.