The Case of the Negligent Insurance Agent
Successful Recoveries from the Cohen, Placitella & Roth Case Files
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Auto Insurance companies rely on policy exclusions to deny benefits. In one of our cases, the auto insurer denied coverage for our client’s claim for uninsured motorist benefits (UIM) for a dual diagnosis of a TBI and spinal cord injury sustained in a motor vehicle crash that occurred in China. At the time of the incident, our client, a U.S. citizen, had full auto coverage from a U.S. insurer, and was working for a year on a project in China. We filed a claim against his U.S. auto insurance company. Eventually we recovered the full $1 million of coverage that he should have been paid.
Our client was injured while he was a seated bus passenger when a driver (a citizen of China) cut in front of the bus, which caused the bus to swerve and crash while trying to avoid striking the driver. There is no auto insurance in China, and there was no viable claim against the driver who caused the crash under Chinese law. Our client’s U.S. insurer denied any obligation to pay benefits under his automobile insurance policy, which included $1 million of uninsured motorist (UIM) coverage.
UIM coverage provides insurance benefits to an insured under their own policy when they are injured by drivers who do not have insurance. In other words, our client purchased $1 million in UIM coverage to protect himself if an uninsured driver injured him, which is exactly what happened here. The reason his U.S. insurer denied the claim was based on an exclusion in its policy that stated that coverage applied only to claims occurring “in the United States, its territories, and possessions.” But for this exclusion, the U.S. insurer admitted it would have paid.
The Investigative Process
Through our investigation, we discovered that our client’s U.S. insurance company sold the policy through one of its employees, an in-house insurance sales agent. The evidence in the case was that the sales agent was negligent and that his conduct fell below the standard of care for licensed insurance agents. Through discovery during the lawsuit, we obtained the sales agent’s file and notes and took his statement under oath (a deposition). We learned that before the policy was sold that the agent knew that our client, an engineer, would be working in China during the term of the policy, and that the policy he sold to our client would not provide any coverage while he was out of the country. Additionally, we proved that other highly respected U.S. insurance companies offered international coverage, including UIM coverage, which is exactly the type of coverage our client needed, and precisely what the in-house insurance sales agent should have, but failed to recommend.
Through expert testimony, we established that the insurer’s in-house sales agent was negligent and breached his professional duty as an insurance sales agent because he failed to advise our client:
1) that his policy would be ineffective while he was in China (essentially a worthless policy) and
2) that he should seek insurance coverage from other insurance companies that offered international coverage
We established that the insurance company was legally responsible for the negligence of its employee, the agent. The result was that we were able to recover the full $1 million policy limits for our client.
A thorough investigation and analysis of the situation by experienced attorneys is essential.
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The Case of the Negligent Insurance Agent
When Traumatic Brain Injury Is Caused by a Defective Product
