Richard C. Gossett and Margaret D. Gossett v. Farmers Insurance Company of Washington
Washington Supreme Court
133 Wash. 2d 954 (1997)
The Gossetts (plaintiffs) agreed to buy and finish an unfinished house intending to resell it at a profit, telling their insurance agent they would be legal owners, and Farmers Insurance Company of Washington (Farmers) (defendant) issued a policy covering their 'insurable interest.' Before closing, the Gossetts assigned their purchase rights to Trusty Deed and agreed title would go to Trusty Deed instead; at closing, Trusty Deed, not the Gossetts, was named buyer and titleholder. The Gossetts worked on finishing the house but never lived there, kept some belongings there, and the house burned down before they ever actually purchased it from Trusty Deed.
Whether an insured has an insurable interest in a covered property beyond improvements made by the insured, if the insured had no ownership interest in the property at the time of the loss.