Insurance Coverage: Do Agents Have a Duty to Advise Customers on What They Should Buy?
Generally speaking, an insurance agent has no obligation to, on its own, evaluate a customer’s particular insurance needs or give the customer advice regarding the coverage the customer should purchase. That said, insurance agents do have a duty to take the appropriate steps to protect their policyholders from potential risks and liabilities. If you think you have a claim for insurance agent or broker malpractice, a Miami insurance coverage lawyer can assist you. Importantly, if you can show that a “special relationship” existed with your insurance agent, his or her duty may be expanded to include advice on the insurance necessary to fulfill your needs. Basic Duties of Insurance Agents and Brokers Insurance brokers are required to exercise good faith and reasonable skill, care and diligence in procuring insurance requested in accordance with the client’s instructions. They are also obligated to obtain: Coverage that is not materially deficient Coverage undertaken to be supplied at the requested limits Requested coverage within a reasonable time (or inform client of inability to do so). No General Duty to Advise Regarding Coverage Deficiencies or Needs If the agent has contracted to provide “standard” brokerage services, then the agent has not agreed to evaluate the customer’s needs or to give the customer advice regarding the coverage the customer should have. This is because insurance agents and brokers are not seen by the law as personal financial counselors or risk manages. A general request for “full coverage” or the “best policy” does not broaden the broker’s […]