What Is Insurance Agent Negligence?
If your insurance claim was denied, and you believe that you should have been covered, it does not necessarily mean that either you or the insurance company were wrong. While insurance companies certainly do deny claims in bad faith, sometimes a lapse in coverage is due to a miscommunication between the insured party and the insurance agent who originally signed them up for the policy. Your insurance agent has a duty to explain your policy clearly and understandably, and to not misrepresent your policy coverage in any way. When you do file a claim, your agent has a duty to file your claim accurately.
You might have been denied coverage because your agent did something wrong at the time of filing, during the investigation process, or because they negligently misrepresented your policy coverage at the outset. In any of these cases, it is not your fault, and you may still be owed benefits for your claim.
How Do Insurance Agents Act Negligently?
Most people who purchase insurance policies are not well-versed in the jargon and legalese the policies include. People rely on insurance agents, brokers, and other representatives from the insurance provider to explain the policy’s terms, the options available, the types of claims the policy covers, policy exclusions, and any other important details of the policy. Once a covered party files a claim, they again rely on insurance representatives to report information accurately and to generally act appropriately and in accordance with their contractual duties.
Agents are people, and people make mistakes. At the point of purchasing the policy, an agent can act negligently by, for example:
- Offering deficient or inadequate advice on which type of policy you should purchase
- Misrepresenting the scope of policy coverage, either by omitting certain information or by affirmatively misstating covered claims
- Recommending inadequate or inappropriate coverage
- Negligently failing to explain and detail the options and terms of your policy
- Failing to send your signed policy to the insurance company
- Signing you up for the wrong policy, different from the policy to which you agreed
- Including inaccurate information on insurance forms and applications
Whether these mistakes were intentional or negligent, and whether they were forgivable or not, the policyholder should not be left with the bill because of the mistakes of their insurance agent. Note that agents cannot simply get out of liability by claiming you failed to read your own policy; you are entitled to rely on the representations of an insurance agent or broker. An experienced insurance agent negligence lawyer can help you get coverage for your claims when a denial was caused by an agent or broker’s negligence.
What Recourse Is Available if a Claim Is Denied Due to the Insurance Agent’s Negligence?
If you were denied coverage because of an agent’s negligence, you can sue the agent and, potentially, the insurance company for negligence. You may be entitled to damages including what you would have received in benefits or payments had it not been for the agent’s negligence.
Additionally, you may be able to sue for additional amounts necessary to compensate you for other harm you suffered because of the agent’s negligence. For example, if you were denied coverage for a planned medical procedure, and your condition was worsened due to the denied coverage and resulting delay in treatment, you might be able to collect additional damages caused by the worsened condition. An insurance law attorney can evaluate the circumstances of your denial and any consequences and inform you of the damages to which you may be entitled.