Insurance Agent Getting Insurance For Their Customer

Mineral Wells insurance lawyers will have situations wherein the agent may have made a mistake in getting insurance for one of their customers. The 11th Court of Appeals issued an opinion in 2015, that provides some insight into how courts examine claims made against insurance agents. The style of the case is, Spurlock v. Grantham-Adkins Insurance Agency. There are other issues in this case, but only the issue related to insurance agent responsibilities will be discussed.
J.O. Spurlock died. Kelly Spurlock, representative of the J.O. Spurlock estate sued the insurance agency for negligent procurement of an insurance policy.
J.O.’s home, after his death, had personal property stolen from it. Kelly made a claim for benefits from the insurance company that was denied due to there being no coverage for the loss that had occurred.
Kelly contends that, if the Beacon policy did not cover his claim for the theft of personal property that occurred after J.O.’s death, then Grantham-Adkins was negligent in failing to procure insurance that would have covered the claim. The elements of a negligence claim are (1) a legal duty owed by one person to another, (2) a breach of that duty, and (3) damages proximately caused by the breach. In Texas, an insurance agent owes the following common-law duties to a client for whom it undertakes to procure insurance: (1) to use reasonable diligence in attempting to place the requested insurance and (2) to inform the client promptly if unable to do so. A client’s request to an insurance agent for a specific type of insurance gives rise to these duties on the part of the agent.
J.O. died on January 26, 2009. Kelly alleged in his petition that, prior to J.O.’s death, J.O. requested coverage for contents from Grantham-Adkins in connection with his purchase of insurance. Kelly also alleged that he or his representative notified Grantham-Adkins of J.O.’s death, that he or his representative requested Grantham-Adkins to continue to provide the coverage provided by the Beacon policy, and that Grantham-Adkins never informed J.O. or him that the Beacon policy did not provide coverage for contents upon J.O.’s death. Kelly further alleged that, on or about March 12, 2009, he made a claim under the Beacon policy for the damage or loss due to theft or vandalism of personal property that occurred.
Grantham-Adkins presented summary judgment evidence. The evidence included Kelly’s deposition testimony. The evidence showed that Stephanie Lou Cordell was J.O.’s caretaker and lived with J.O. before he died. Cordell claimed that she was J.O.’s common-law wife and that she owned J.O.’s house. In April 2009, Kelly obtained an order from a justice of the peace evicting Cordell from the premises. Kelly testified that he did not obtain access to J.O.’s house until after Cordell was evicted. After the eviction, Kelly entered the house and discovered that contents had been removed from the house. Kelly believed that Cordell had stolen the property.
Kelly testified that he and his friend, John Backer, contacted Grantham- Adkins after J.O. died. Kelly believed that he and Backer made two telephone calls to Grantham-Adkins. However, Kelly did not know when either of the calls occurred. Kelly said that, during the first call, he and Backer informed Grantham-Adkins that J.O. had died and that Kelly was in the process of being appointed as the administrator of J.O.’s estate. Kelly also said that he and Backer requested Grantham-Adkins to renew the policy and to change the mailing address on the policy. Kelly testified that, during the second call, he and Backer informed Grantham-Adkins about the theft of personal property from J.O.’s residence.
Backer stated in correspondence to Kelly’s attorney that “Kelly Spurlock informed the Grantham-Adkins Agency about J.O.’s death and the theft in April 2009.” When asked about this statement in his deposition, Kelly acknowledged that his first contact with Grantham-Adkins following J.O.’s death may have occurred in April 2009, after Kelly entered J.O.’s house and discovered the theft.
Backer’s statement constituted summary judgment evidence that Kelly did not contact Grantham-Adkins until after the loss occurred. During his deposition, Kelly could only speculate as to when he contacted Grantham- Adkins. Kelly filed an affidavit in response to Grantham-Adkins’s motion for summary judgment. In the affidavit, Kelly did not provide any additional information as to his contact with Grantham-Adkins. Kelly did not present summary judgment evidence that he requested any type of insurance coverage from Grantham-Adkins before the loss occurred. Specifically, there was no summary judgment evidence that Kelly requested Grantham-Adkins to procure insurance to cover a theft of contents from J.O.’s home. Kelly neither alleged in his petition nor presented summary judgment evidence that J.O. requested coverage from Grantham-Adkins that would have covered a theft of personal property from his residence after his death.
In the absence of such a request, Grantham-Adkins did not owe a duty to Kelly to use reasonable diligence to obtain insurance.
Thus, this appeals court upheld the summary judgment ruling in favor of the agent.