90 N.Y.2d 266 (1997)
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An insurance agent generally has no continuing duty to advise a client to obtain additional coverage unless a “special relationship” exists, demonstrating justifiable reliance on the agent’s expertise beyond the ordinary agent-insured relationship.
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Summary
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Thomas Murphy sued his insurance agent, Donald Kuhn, alleging negligence and breach of implied contract for failing to advise him to increase his automobile insurance coverage limits. Murphy’s son was involved in a fatal car accident in 1991, and the policy limits were insufficient to cover the resulting claims, leaving Murphy personally liable for a substantial sum. The New York Court of Appeals affirmed the dismissal of the complaint, holding that Kuhn had no duty to advise Murphy on additional coverage because no special relationship existed between them. The Court emphasized that the insured bears the responsibility for initiating and seeking appropriate coverage.
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Facts
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Donald Kuhn provided insurance to Thomas Murphy and his business, Webster Golf Course, Inc., since 1973. Kuhn handled Murphy’s personal insurance needs beginning in 1977. In 1990, after Hartford threatened to cancel Murphy’s personal auto coverage due to his children’s poor driving records, Murphy transferred coverage for his son’s car (titled in Murphy’s name) to Webster Golf Course’s commercial auto policy. The commercial policy had liability limits of $250,000 per person and $500,000 per accident since 1984. Murphy never requested higher liability coverage. After a 1991 accident involving his son, Murphy exhausted the $500,000 policy limit and personally paid an additional $194,429.50, leading to the lawsuit against Kuhn.
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Procedural History
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The Supreme Court granted the defendants’ motion for summary judgment, dismissing the complaint. The Appellate Division affirmed this decision. The New York Court of Appeals granted leave to appeal and affirmed the Appellate Division’s order.
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Issue(s)
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- Whether an insurance agent has a continuing duty to advise a client to obtain additional insurance coverage absent a specific request from the client.
- Whether a
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