A Connecticut insurance agent has no duty to inform clients that their home insurer intends not to renew their insurance policy, the state’s high court recently affirmed in a case where the homeowners had argued that their long relationship with the agent created a legal duty for their agent to inform them.
The homeowners, Lee and Keleen Deer, who were seeking payment on a claim after a fire destroyed their home, lost their appeal of lower court judgments in favor of their agent Kevin Trahan and his insurance firm, The Trahan Agency.
From 2001 through 2017, Trahan was the Deers’ insurance broker, procuring a homeowners insurance policy from Allstate Insurance Co. that Allstate renewed 15 times. From March 2017 through June 2019, the Deers used a different insurance broker for their homeowners insurance. In 2019, they restarted their relationship with Trahan, obtaining a Century-National Insurance Co. policy through the agency.
Shortly after the policy was issued, Century-National inspected the Deers’ home and found a defect in the exterior siding. The insurer sent an email to Trahan informing the agency of this defect and indicating that the Deers were required to repair the defect and provide notice of the repair no later than three months before the policy was to renew. The parties disputed whether Trahan conveyed this information to the insureds.
After not receiving any notice of repair by the deadline, Century-National sent another email to Trahan informing the agency that it had not received notice of repair and that the Deers’ policy would not be renewed if notice of repair was not received by the policy expiration date. Approximately four weeks later, and two months before the policy expiration date, Century-National sent a nonrenewal notice to the Deers by certified mail, which the insureds claimed they never received. Ultimately, Century-National never received notice of repair, and did not renew the policy.
Shortly after expiration of the policy, the plaintiffs’ home was destroyed by an accidental fire. The plaintiffs made a claim under the policy, but Century-National denied their claim because the home was not insured at the time of the loss. The Deers said they had assumed that their policy had been renewed just as their Allstate policies had been for 15 years.
The Deers sued Century-National, alleging that the insurer had failed to comply with the state’s notice requirements and the notice provisions of the homeowners insurance policy. The homeowners also claimed that Trahan and the agency had violated the Connecticut Unfair Insurance Practices Act and the Connecticut Unfair Trade Practices Act. The trial court rendered judgment in favor of Century-National and Trahan with respect to these claims, and the appellate court affirmed. The Supreme Court denied the Deers’ petitions to hear their appeals as to those claims.
Separately, the Deers sought damages from Trahan in a negligence suit, claiming that the agent had a duty to notify them of communications from Century-National, including a nonrenewal notification, but negligently failed to do so. This Supreme Court opinion is limited to this common-law negligence claim against Trahan.