Insurance Agent & Breach of Fiduciary Duty

By:
On:
In: Insurance

When Insurance Agents Breach Fiduciary Duties

10 Reasons to Never Trust an Insurance Company | Houston Personal Injury Lawyer Breach of fiduciary duties can compromise legitimate claims, derailing efforts to recover from accidents and other events caused by negligence. Nevertheless, Texas law does not outline formal fiduciary duties that insurance agents have to insured individuals, and bringing these claims can be challenging in the Lone Star State.

It does not completely negate the duties of fiduciary agents’ insurance, nor does it grant them a carte blanche to act without any claims from individuals insured with them, however, they do not want to grant them complete freedom.

Agents may encounter potential consequences and legal ramifications if they violate these fiduciary obligations while handling claims and interacting with insured individuals, which agents are typically required to uphold. However, there exist certain fundamental fiduciary duties.

Examples of Insurance Agent Breach of Fiduciary Duties

Irrespective of individual preferences, which ought to be upheld, a level of caution is set between these two entities, and a fiduciary obligation between an insurance agent and a client is a connection built on trust and honesty, necessitating the agent to operate in the customer’s utmost advantage.

Denied Claims - Breach of Fiduciary Duty - Insurance Lawyer Insurance agents can breach the fiduciary duties and fail to provide the necessary standard of care whenever:

  • An agent is careless in his or her dealings with an insured individual.
  • Legitimate insurance claims are deliberately and unjustly rejected.
  • Deceptive or inaccurate information is utilized to manipulate clients.
  • A representative participates in post-claim underwriting.

    • If you suspect any of these actions is involved with your claim and you’re engaging with an insurance agent, it is advisable to consult an experienced insurance lawyer as soon as possible.

    An attorney can explain your legal options and rights to you while advising you on the best options for protecting your potential claims and interests.

    Bad Faith Insurance Claims & DTPA Violations

    Insurance agents have been known to engage in violations of the Texas Deceptive Trade Practices Consumer Protection Act (DTPA), violations of the insurance code, and bad faith practices, in addition to breaching their fiduciary duty.

    These actions can manifest in various ways in the tangible realm, encompassing (but not restricted to):.

  • Distorting the extent or restrictions and exceptions of the coverage or policy.
  • Engaging in shortcuts during claim investigations to manipulate the discoveries.
  • Neglecting to reveal crucial details regarding a claim or policy.
  • Revoking policies without justification after claims have been submitted.

    • Insurers can potentially take advantage of claimants by employing various strategies to manipulate the claims process, allowing them to make payouts or circumvent limits in order to obtain the upper hand.

    That is why a skilled lawyer can be so vital when it is time to:

  • Determine the character of unethical or potentially illegal actions performed by insurance adjusters.
  • Identify the nature of legal infractions that have occurred.
  • Identify the accessible solutions and the process of commencing legal proceedings.
  • Gather the proof required to pursue complete, equitable remuneration.

    • Particularly when dealing with insurance companies, surprise can come as violations of DTPA or bad faith practices, with minimal filing of claims in the past, despite claimants diligently paying their premiums.

    In order to counteract their strategies and confront insurance companies, it is essential to seek the guidance of a skilled lawyer who understands what needs to be done in such situations.