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Insurance Agent Claim Requires AOM

Wednesday, January 3, 2018   (0 Comments)
Posted by: Tom Jensen
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Plaintiffs' nutritional health business property was insured for business interruption, "extra expense," and personal property losses. When the insurer declined to re-write the coverage plaintiffs contacted defendant agent who placed the risk with a different property insurer. Then Superstorm Sandy struck causing plaintiffs property damage. Insurer denied several aspects of the claim based on policy language that differed from the language of the prior policy. Plaintiffs sued agent claiming failure to procure coverage, negligence and contract breach. No AOM was obtained, triggering the defense SJ motion. Trial court granted SJ, finding plaintiffs' "common knowledge" exception argument unavailing. Ruling was affirmed in Ehrhardt v. Amguard Ins. Co., 2017 WL 6048119 (N.J. App. Dec. 7, 2017). Court ruled "the trial court logically found that plaintiffs' negligence claims against [agent] substantially encompassed professional standards of care within the insurance producer industry, and are not amenable to fair evaluation by lay jurors merely based on their common knowledge." It continued "[t]he selection of appropriate coverage for an insured business, and an understanding of the complexities of insurance policy definitions, exclusions, and exceptions, is patently a subject outside of the understanding of lay jurors lacking the benefit of expert testimony."   


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