Life Insurance Agent Liability-3

Lawyers who handle life insurance cases need to be aware of the various ways a life insurance agent can be held responsible for wrongful acts.
While an individual agent is subject to being sued under the statutes here is a specific example of that happening.  This is from the 1998 Texas Supreme Court opinion styled, Liberty Mut. Ins. Co. v. Garrison Contractors, Inc.
In the Garrison opinion, an agent personally carried out the transaction that formed the core of the unfair insurance practices complaint.  The agent was responsible for explaining premiums and was required to have a measure of expertise.  He was a “person” engaged in the “business of insurance” and could be liable under the statute.  On the other hand, clerical employees, who have no responsibility for policy sales and servicing and no special insurance expertise, are not “engaged in the insurance business,” and thus would not be personally liable under this rationale.  The same reasoning should apply to other statutes, like the unfair discrimination statute, that include similar defenses.
An agent may also be personally liable for performing acts on behalf of an insurer, if the insurer has not complied with the requirements of state law.  This is in Texas Insurance Code, Section 4001.053.  Arguably, a person would not normally be liable for breach of contract, discrimination, or failure to promptly pay a claim could become liable in the place of the insurer in these circumstances.
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