Choose from any of our reports and we will be happy to send it/them to you via email at no cost.


    Just how special is that relationship?

    “I was only following orders” – while a weak statement in most cases, this is often supported by the courts for insurance brokers. The courts state the duty of the insurance broker is to do what the customer asks, nothing more.  In a recent case[1], a manufacturer (C.S. Osborne & Co., Inc.) had $1,000,000 in flood insurance.  Super Storm Sandy came, and the $1,000,000 was inadequate.

    Osborne pursued a suit against their insurance broker – indicating that the broker should have provided quotes for higher limits, and the courts concluded:  an insurance broker was “not an insurance consultant, and that if Osborne had wanted an insurance consultant, it could have retained one.”  The court brings it back to compensation “[the broker’s ] proposal clearly stated it would receive payment from the insurer [and] did nothing to suggest it worked for anyone else.”

    Your broker may be special to you, a good friend and skilled at finding you coverage, but, if the coverage isn’t there, it’s likely you will hear about the “order taker” defense.  Separating advice from sales can prevent this.

    [1]  C.S. Osborne & Co., Inc. v. Charter Oak Fire Ins. Co., No. A-2182-15T4 (N.J. App.Div. May 1, 2017)

    Abby Krueger

    [email protected]

    Jul 03, 2017

    Licata Risk Licata Risk & Insurance Advisors, Inc.
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    LicataRisk Advisors is an independent risk management and insurance consulting firm. We are not brokers and we do not sell insurance. We are not connected to any insurance company or product in any way and do not receive commissions. This is an important difference as you will have an expert on your side who is only committed to you.

    Licata Risk is not a law firm and does not practice law. General advice and contract input by the consultants, including those who are attorneys, is to provide insight into the risk and insurance aspects. Your attorney should be the final authority on any legal matter.