While some of their claims were dismissed, plaintiffs' breach of fiduciary duty survived the insurer's motion to dismiss. Senft v. Fireman's Fund Ins. Co., 2015 U.S. Dist. LEXIS 61870 (D. N.J. May 12, 2015).
Plaintiffs' waterfront home was insured by Fireman's Fund. Plaintiffs alleged that the broker represented that the policy would provide (1) coverage in the event of a hurricane,(2) the "highest level of protection" offered by Fireman's Fund, and (3) "exceptional" services in the event of a catastrophe. The policy included a 2% hurricane deductible because of the home's proximity to the ocean.
Hurricane Sandy badly damaged plaintiffs' home. Plaintiffs alleged that the winds from Sandy battered their home long before the storm surge reached the structure.
After the storm, Fireman's Fund rejected the claim without visiting the property. When plaintiffs protested, an inspector made a cursory visit to the property. Fireman's Fund asserted that the storm surge caused all of the damage and the loss was therefore excluded.
Plaintiffs sued and Fireman's Fund moved to dismiss several counts. The court first dismissed the claim for breach of the implied covenant of good faith and fair dealing because it was duplicative of the bad faith count. The court saw no distinction between the two claims.
Regarding the breach of fiduciary duty claim, the court noted that a fiduciary relationship could arise from an insurance agent's interactions with an insured. Plaintiffs adequately pled that Fireman's Fund owed them a fiduciary duty and breached it. The complaint alleged that Fireman's Fund, independently and through its brokers, represented to plaintiffs that the policy provided the type of coverage that they desired and needed. These allegations made it plausible that Fireman's Fund owed a fiduciary duty and breached it by failing to provide coverage for hurricane-related damage that Plaintiffs trusted Fireman's Fund to provide. Therefore, the motion to dismiss the breach of fiduciary duty claim was denied.