Tennessee Insurance Dispute Lawyers Handling Agent Negligence Claims
Helping policyholders throughout the Southeast and Midwest get a fair assessment of their losses
You ask your insurance agent to give you all the options and explain all the risks. You then rely on the agent to do his or her job and get you the right insurance coverage. You pay your premiums. When insurance agents fail to get you the protection you thought you paid for, you may have the right to sue the insurance agent and the insurance company for negligence.
At McWherter Scott & Bobbitt, our Tennessee-based agent negligence attorneys work to get insurance companies to honor valid contracts and fight to hold insurance agents responsible when the agent fails to do his/her job. For years and years, we have helped policyholders across the South get the insurance benefits for which they bargained. We know that agents sometimes fail to perform their duties for a variety of reasons, but non-performance is never acceptable. Our firm understands the legal theories and facts necessary to bring claims against agents who fail to get you the right coverage for you needs.
Types of agent insurance negligence
There are many reasons insurance agents fail to get applicants the insurance they need. Rarely, the agents are just dishonest and steal the premiums. Most times they are inexperienced or just sloppy. It can be quite upsetting to learn that you paid premiums, but that the insurance policy does not cover the type of loss your suffered. When agents are irresponsible, the law of many states allow claimants to also make claims against the insurance company as well. For example, in Tennessee, the law is well-settled that an insurance producer (no matter whether a broker or agent) is the agent of the insurance company and that the knowledge (and liability) of the agent is imputed to the insurance company. The theories can be varied, and the law is complex – contract claims, tort claims, reformation. Experience and knowledge in this field can make the difference in the outcome of the case.
Our Tennessee-based agent negligence lawyers have handled dozens of agent negligence lawsuits based on a variety of different failures, including:
- Completing an application with inaccurate information. Agents often complete applications without asking policyholders the questions contained on the application or having policyholders sign a blank application that is filled out later by the agent. This may result in false information being provided to the insurance company and a denial being issued for misrepresentations on the application. This sort of conduct can constitute negligence for which the agent and the insurance company are responsible.
- Giving incomplete information about available options. An agent’s job is to listen to your needs, figure out what coverage is required (and anticipate other types of coverage that should also be offered), and then create options for the customer. Failing to properly explain what is needed, what is excluded, and any limitations may constitute negligence on the agent’s behalf. Agents should be informed, experienced, and familiar with the products they are selling. They are not just salespeople, but instead they are professionals.
- Failing to explain exclusions and limitations. The standard of care requires that agents review exclusions and limitations with their customers. With knowledge, the person buying the insurance can make good decisions. It is not the agent’s fault if options were explained but the customer declined certain coverage. However, if the opposite is true and no options were provided, legal remedies may be available.
- Failing to obtain the correct coverage. Insurance agents need to make sure the underwriter gets the application, correct information, the necessary paperwork, and the right policy. Failing to procure coverage is one of the more common errors made by agents and, as such, is a common reason why people file claims against their agents and insurers.
- Failing to obtain enough coverage. It is the job of an insurance agent to make sure that their customers are properly insured. Scary things like coinsurance, and grossly underinsured losses, can result if agents fail to fulfill that job. There are a multitude of tools available to insurance agents to assist them in the process. In many states, industry standards mandate that replacement cost calculators be used, that periodic reviews be performed, and that insurance agents utilize the vast resources available to them regarding construction costs to make sure properties are properly insured to value.
- Failing to activate the insurance. The insurance agent should make sure the policy begins and ends on the dates intended and that it is in full force during the requested period
- Misrepresentation. Agents cannot lie, deceive you, or provide false information to get you to pay insurance premiums.
- Failing to properly explain any needed changes in your coverage. Some agents send out a newsletter, make periodic phone calls, or schedule an annual review of coverage to remind insureds it is important to advise of changes that might impact insurance needs. Certainly policyholders should let their agent know of changes. However, in many cases, the agent should predict and be proactive about some issues. For example, if the same policyholder has insured a building with an agent for 20 years, it should not come as a shock that the replacement cost has increased over that time, or that the cost of complying with ordinance and law has risen exponentially. These are just some of the reasons people hire agents, and it is their job to make sure policyholders are armed with the wisdom to make proper decisions regarding their insurance needs. If agents fail to do so, the law may hold them accountable.
- Failing to renew insurance or send a notice of the need and time limits for renewing your insurance. Many policies renew on a yearly basis. Insurance agents should make sure that policies are properly renewed.
- Other errors and omissions. Each claim we handle is reviewed on a case by case basis to determine if there is a claim of agent negligence. Most agents are good people, but mistakes happen and if they do, the law is clear agents can be held liable if their decisions or inaction cause their customers damage.
The liability of the agent and the insurance company
In some states, including Tennessee, the insurance company is liable for the negligence, misrepresentations, and misconduct of its agents. Agents owe a duty to their clients to, at the bare minimum, perform their work competently. The duty of the agent to act competently applies to every type of insurance including property insurance, homeowners’ insurance, commercial insurance, life insurance, and health insurance. In addition, agents are normally required to be properly licensed, comply with the applicable rules and regulations, and abide by the applicable standard of care.
In John Doe v. ABC Insurance Company, our attorneys obtained a $190,000 settlement in a case in which the insureds alleged that the agent negligently underinsured their home.
Dedicated attorneys holding insurance agents and insurance companies accountable for negligence
At McWherter Scott & Bobbitt, we fight for those who suffer harm because of insurance company’s bad actions or insurance agents’ negligence. We help policyholders across the Southeast get prompt payment for their claims. When you discuss your situation with an insurance agent, you deserve to get the right insurance policy and the right benefits. To review your case with an experienced Tennessee residential insurance lawyer, please call 731-664-1340 or fill out our contact form. Our attorneys are licensed in Tennessee, Kentucky, Arkansas, Mississippi and Missouri.