It can’t have it. Or at least it cannot if the fire starter is the renter of one half of the duplex. In this recent case scenario, the renter of one half of a duplex accidently started a fire that destroyed the whole home. The insurance company sued the renter. But the suit was for only those losses on that half of the duplex that the renter did not occupy. The insurer was trying to bypass Nebraska case law that forbids an insurer from collecting subrogation damages from its own policyholder. The owner of the duplex bought and paid for the insurance. The insurance company argued that the rule should not apply here since it was trying to collect from the renter, not the duplex owner.
Nonetheless the Nebraska Supreme Court denied the insurance company’s claim. It ruled that a tenant is considered to be an “implied co-insured.” The renter stands in the shoes of landlord in obtaining insurance coverage for all units. Even if the renter is not the actual policyholder, he is to be treated as such. The court stated that equity governed its decision. “It is a commercial reality that insurer, being aware of our decision… will charge premiums sufficient to cover that risk.” See Buckeye State Mutual Ins. Co. v. Humlicek, 284 Neb. 463, ___ N.W.2d. ___ (Oct. 12, 2012).