Scope of Independent Agents’ Duty Continues to be Source of Confusion

In Taylor v Lake Michigan Ins Co, a divided panel held that the independent insurance agent owed no duty to the Plaintiffs “to ensure the adequacy of the insurance coverage they obtained” for the Plaintiffs’ home.

 After a fire destroyed the home, the carrier paid the policy limits, but this left the Plaintiffs around $400,000 short of being able to rebuild.

 According to the majority, the agent had no duty to recommend higher policy limits, where the limits were clear from the quote, there was no misrepresentation by the agent, Plaintiffs did not make “an ambiguous request or one that required clarification,” the agency used accurate information to generate the quote, and the agency did not assume “an additional duty at any time by either express agreement or promise to plaintiffs.” Taylor, unpub op at 5-6.

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