§ 6.6 Action by Insured Against Insurance Agents

LibraryInsurance Law in Oregon (OSBar) (2020 Ed.)
§ 6.6 ACTION BY INSURED AGAINST INSURANCE AGENTS

§ 6.6-1 Negligence

An insured may bring a negligence action against an independent insurance agent who works for multiple insurers. However, an insured may not bring a negligence action against a "captive agent" who works exclusively for one insurer. See Lewis-Williamson v. Grange Mut. Ins. Co., 179 Or App 491, 496, 39 P3d 947 (2002) ("Although plaintiff trusted [agent] to take care of her insurance needs, there is no evidence that she had reason to expect, other than through her trusting nature, that he would work on her economic behalf. He was not her insurance agent, because he wrote insurance exclusively for [insurer].").

The Oregon Court of Appeals has determined that an agent may be subject to liability for negligence in a number of circumstances. For example, cases in which an insurance agent agrees to procure insurance for an insured, such as Caddy v. Smith, 129 Or App 62, 66, 877 P2d 667, rev den, 320 Or 270 (1994), in which the court held that the agent had a duty to explain the extent in which the insurance policy actually provided the coverage that was requested; Kabban v. Mackin, 104 Or App 422, 801 P2d 883 (1990), in which the court held that the agent had a duty to advise the prospective insured regarding the different coverages and policies that were available; and Precision Castparts Corp. v. Johnson & Higgins of Oregon, Inc., 44 Or App 739, 607 P2d 763 (1980), where the agent's duty included a duty to warn the insured about the significant distinctions between the alternative insurance policies under consideration. "An allegation to the effect that defendant failed to do so is sufficient to state a cause of action in negligence." Precision Castparts Corp., 44 Or App at...

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