Bast v. Capitol Indemnity Corp.

OPINION

LANSING, Judge.

This dispute between an insurer and a loss payee named in an insurance policy raises issues of whether the payee is entitled to notice of a policy amendment and whether notice of cancellation must be in writing. We hold that because a standard form mortgage clause establishes an independent contract between an insurer and a named loss payee, the payee as a party to the contract is entitled to notice of material changes in the contract effecting reduced coverage. We further hold that actual notice to the named loss payee satisfies the cancellation notice requirement.

FACTS

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