"Because our insurer already maintained a policy insuring our interests in the loss location we rejected a second policy mistakenly placed by the same insurer when the property was refinanced two years before the loss. After the fire the claim was denied, however, for reasons I cannot explain in this forum, our insurer was required to reinstate coverage. They reinstated coverage, however, not under the policy in place at the time of the loss,(the one they denied) but under the policy we rejected two years earlier, claiming this to be the only “valid policy”. 1)Isn't acceptance and consideration necessary to create legally binding contract of insurance? 2)If an insurer knowingly pays a claim under a policy they were not legally obligated can their subrogation rights be challenged based on the doctrine of voluntary payment. 3) Can an insurer resurrect this rejected policy for their benefit simply to avoid admitting liability under a policy they previously denied? 4)Does payment under the wrong policy have any effect on our right to fully recover from the third party wrongdoer for losses claimed under the policy denied by our insurer?

About The Expert

Amy Bach

Amy Bach has been a professional advocate for insurance policyholders since 1984 and an attorney since 1989. She co-founded United Policyholders in 1991 and serves as the organization's Executive Director and primary spokesperson; shaping and overseeing the Roadmap to Recovery™, Roadmap to Preparedness, and Advocacy and Action programs. She is a nationally recognized expert on insurance claim and legal matters; frequently interviewed in print and broadcast media, and the author of numerous publications including "The Disaster Recovery Handbook", "WISE UP: The Savvy Consumer's Guide to Buying Insurance" and consumer tips and guides in the UP Claim Help Library.  Recognized by Money Magazine as a Money Hero, Bach is in her eighth consecutive term as an official consumer representative to the National Association of Insurance Commissioners, and is a member of the Federal Advisory Committee on Insurance.