United States Court of Appeals For the Seventh Circuit ____________________ No. 21-3116 WILLIAM M. WERNER, Plaintiff-Appellant, v. AUTO-OWNERS INSURANCE COMPANY, Defendant-Appellee. ____________________

Appeal from the United States District Court for the Central District of Illinois. No. 3:18-cv-03190-SEM-TSH — Sue E. Myerscough, Judge. ____________________

ARGUED JUNE 7, 2022 — DECIDED JULY 9, 2024 ____________________

Before HAMILTON, KIRSCH, and JACKSON-AKIWUMI, Circuit Judges. HAMILTON, Circuit Judge. This appeal presents an issue under Illinois insurance law about the extent of an owner’s insurable interest when a home is in foreclosure proceedings. The narrow issue is whether and to what extent the owner of a home in foreclosure has an insurable interest in the property after a judgment of foreclosure, after a judicial sale, and after 2 No. 21-3116 expiration of all the owner’s rights of redemption, but before judicial confirmation of the foreclosure sale. Plaintiff-appellant William Werner’s home in Springfield, Illinois, was in foreclosure when it burned down in 2017. On cross-motions for summary judgment, the district court ruled that Werner had lost any insurable interest in the full value of the property after the judicial sale occurred and all of Werner’s rights of redemption had expired. The court held that at the time of the fire, Werner’s only remaining insurable interest in the property was based on his narrow right under 735 ILCS 5/15-1701(b) & (c)(1) to occupy the home until 30 days after the judicial sale was confirmed. The court awarded him the rental value of that temporary right, not quite $4,000, which was much less than Werner sought. Werner has appealed, and we affirm. When his home burned down, Werner still held legal title to the property, but he had no legal right to redeem it from foreclosure or other- wise to retain it. Its future was out of his control. We agree with Judge Myerscough that his only insurable interest was in the value of his temporary right of possession. I. Factual and Procedural Background A. The Mortgage, Foreclosure, and Sale Werner built a home in Springfield, Illinois, in the early 1980s. He borrowed money to build the home, and the loan was secured by a mortgage. He later refinanced the loan and mortgage through Nationstar Mortgage, LLC. Werner fell behind in his mortgage payments, and in May 2013, Nationstar filed a foreclosure action in an Illinois state court. The court entered a default foreclosure judgment against Werner, finding that he owed Nationstar $80,398.73 and that No. 21-3116 3 the debt was secured by a valid mortgage against his home. The court ordered the property to be sold if, as eventually occurred, Werner’s statutory redemption rights expired. The judicial sale of the property was delayed for several years after Werner sought protection from his creditors in bankruptcy. When the bankruptcy court lifted the stay on the foreclosure proceedings, Werner’s home was put up for a judicial sale to satisfy the foreclosure judgment. On June 14, 2017, a third-party buyer, Triple J Property Brothers, made the highest bid: $23,606. A month later, Nationstar moved to confirm the judicial sale to Triple J. Werner opposed confirmation on three grounds, arguing that (1) Nationstar lacked standing to sue; (2) Nationstar improperly calculated the interest due on any deficiency judgment; and (3) the sale price was unconscionably low. B. The Fire and Insurance Issues Before the state court ruled on Nationstar’s motion to con- firm the sale, a fire destroyed Werner’s home. The fire was ap- parently cau