“What if I find out after an accident that my insurance agent didn’t sell me the proper coverages? Can I sue the agent for the mistake?”
Many people don’t pay much attention to their insurance coverages until they have an accident. Only then might they find out that they weren’t covered at all for a particular loss, or that they didn’t have nearly enough coverage to take care of their losses. The question often arises whether the insurance agent should have told the customer which coverages to buy, or how much to buy.
The answer is usually “No.” In Michigan, an insurance agent is generally just an “order taker” who sells you whatever you ask for. The agent doesn’t have a duty to help you figure out whether you are buying more or less coverage than you need, and it is your responsibility to know what your coverages are. As with most things in the law, there are some exceptions, although they can be difficult for the customer to prove. Here are the four exceptions:
Remember, you need proof to get anywhere with these exceptions. Your word alone against the agent means you lose.
Please keep in mind that the insurance policy is a contract. You are expected to know what it says. If you think you have been misled by an insurance agent and that you can prove one of the exceptions, a lawyer who does insurance work may be able to help you.
Source: 461 Mich 1