PLMImedium
Under the Michigan Standard Fire Policy at MCL 500.2832, which statement about mortgagee rights is correct?
AThe mortgagee has no independent right to collect if the insured's act voided coverage.
BThe mortgagee must be added by a separate policy rather than by endorsement to the same contract.
CThe mortgagee may only collect after the insured signs a release of all claims against the insurer.
The mortgagee's interest is protected even if the insured's act would otherwise void coverage.
Why this is the answer
MCL 500.2832 incorporates the standard mortgage clause: the mortgagee's interest is not invalidated by the insured's acts, neglect, or breaches of policy condition. The mortgagee retains a direct, independent claim against the insurer.
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