Lawyers in general and insurance lawyers specifically know there are two types of authority — actual and apparent. In turn, actual authority can be expressed or implied. An agent’s authority can be actual authority expressly conferred by the insurer, or it can be actual authority implicit in the agent’s duties. The authority also can be apparent authority arising from acts by the insurer that give the agent the appearance of having authority.
Unfortunately, courts are not always precise in labeling the types of authority. Confusion creeps in when courts mistakenly call implied is not actual authority, or when they speak of implied authority as a form of apparent authority.
Courts have described actual authority this way: