Strategies, Challenges, and Answers

In Nevada, An Insurance Agent Or Broker Is Generally An Agent Of The Insured, Not The Insurer

It was a terrible fire.  On November 21, 1980, 85 people died when a refrigerated pastry display caught fire at the MGM Grand in Las Vegas.  The Grand Hotel Gift Shop was destroyed in the fire.  The Gift Shop suffered almost a $1,000,000 in business interruption damages.  The Gift Shop sued its insurance broker, and the insurance company that wrote its business interruption insurance, Granite State Insurance.  Prior to trial, the Gift Shop settled with the broker and resolved several of its … [Read more...]

Nevada Allows Policyholders To Sue Certain Managing General Agents and Third-Party Administrators For Bad Faith

An agent who acts for a disclosed principal is not liable for commitments made by the agent in the principal’s behalf.  See ALI’s Restatement (Second) of Agency § 320 (1958).  In the field of insurance, managing general agents, third-party administrators and independent adjusters have regularly shielded themselves from claims of bad faith brought by policyholders’ against the insurance company for which that agent works.  But that rule of hornbook law is beginning to erode following insurance … [Read more...]