REMINDER: A Carrier's Settlement May Not Protect an Agent from Liability

Did you know that under New Hampshire law an insurance agent is not necessarily protected by a legal settlement executed by the agent’s carrier? 

 

In Balamotis v. Hyland, II d/b/a State Farm Agent, 159 N.H. 803 (2010), the New Hampshire Supreme Court held that State Farm’s settlement with an Insured over a coverage dispute did not prevent a subsequent suit by the Insured against State Farm’s Agent for failure to procure insurance as instructed by the Insured. 

 

The settlement document at issue did not purport to cover “agents” of State Farm and referred only to its “heirs, administrators, executors, successors, and assigns.”  Accordingly, the later suit against the Agent was not prohibited.  Such a claim against the Agent, the Court held, is separate and distinct from a claim against the Insurer for payment under the policy.

 

If you have questions regarding your rights and risks as an insurance agent, one of our insurance law professionals can advise you.