New Jersey insurance producers—colloquially referred to as “brokers”—are heavily regulated and held to a high professional standard. In many respects, New Jersey courts hold insurance producers to the same professional level of care as attorneys and doctors. See Rider v. Lynch, 42 N.J. 465, 476 (1964) (if an insurance broker “neglects to procure the insurance or if the policy is void or materially deficient or does not provide the coverage he undertook to supply, because of his failure to exercise the requisite skill or diligence, he becomes liable to his principal for the loss sustained thereby.”). This treatment of an insurance producer contrasts, for example, with the manner insurance producers are treated in New York, where the sale of insurance is generally viewed as a commercial transaction, only imposing heightened obligations on an insurance producer under certain circumstances. See Murphy v. Kuhn, 90 N.Y.2d 266, 270 (1997); Chase Scientific Research v. NIA Group, 96 N.Y.2d 20, 28-31 (2001).

It is not surprising then that, as occurs in the legal malpractice context, claims of breach of fiduciary duty are often inappropriately asserted alongside claims for professional negligence in actions against insurance brokers and agents. This article discusses the conflation that often occurs in the case law between the two causes of action in insurance producer malpractice actions, and urges a greater sense of clarity in their use by practitioners and fairness in their application by our courts.

The Insurance Producer’s Fiduciary Duty

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