How can an insured in CA rescind a homeowners policy? (reason is the policy issued does not match the coverage quoted)

Question

I obtained a quote for homeowners insurance in June. The insurer's agent told me the policy provided "building code upgrades" coverage that was not subject to any policy limit and that the property qualified for a discount related to the roof type. After purchasing the policy, I found that the building code upgrades coverage is actually capped at 10% of the base policy limit. The agent also informed me about one month after I paid the full year's premium that he had made an error in characterizing the roof type and the discount does not actually apply, so they're now billing for an additional premium payment -- over $100 more than what was quoted -- despite the fact that I accurately reported my roof type to the agent at the outset. I told the insurer to either honor the policy as quoted or rescind it and issue a full refund, but they will only agree to cancel and issue a pro-rated refund for the remainder of the policy term. How do I formally exercise my right to rescind the policy?

William John Light · Answer

You have to file a lawsuit for rescission.  However, a pro rata refund may be appropriate because you have the benefit of the policy coverage from the date of purchase through the date of cancellation.  Even though you don't want it.  Rescission would mean that you were uninsured from former the date of purchase until you acquire new coverage.  Seems unwise.  A potential complaint for specific performance might also be considered, ie., a lawsuit to provide the coverage promised for the price promised.  All of these lawsuits costs thousands and thousands of dollars.  I don't believe that there is a monetary justification for it.

Q: How can an insured in CA rescind a homeowners policy? (reason is the policy issued does not match the coverage quoted)