The insurer unsuccessfully moved for a determination that it had no duty to defend a public adjuster. Singer v. Continental Cas. Co., 2016 U.S. Dist. LEXIS 82286 (E.D. Pa. June 24, 2016).

    Plaintiffs in the underlying action alleged that the public adjuster, Brian Singer, negligently performed his duties while assessing and inspecting a claimed loss at the plaintiffs' home. During the inspection, Singer identified and documented the existence of a damaged gas line. A month later, gas leaking from the damaged line allegedly caused an explosion, resulting in one death and other serious injuries. Plaintiffs alleged that Singer failed to close the valve of a propane tank connected to the gas line and never posted warnings about the gas line.

    Singer's employer, Alliance Adjustment Group, held a liability policy with Continental. The policy had a Professional Services Exclusion which excluded coverage for "bodily injury . . . caused by the rendering or failure to render any professional service." The service contract between the underlying plaintiff and Alliance provided that Sinter was "to advise and assist in the adjustment of an insurance claim at [the insured's] home."

    Singer testified at his deposition that he would occasionally tell an insured not to make permanent repairs until the insurer conducted its own inspection. Otherwise, the insurer may resist paying for the claim. Singer further testified, however, that he never told the underlying plaintiff not to have the gas line fixed.

    Continental denied coverage. Singer sued Continental for breach of contract. Continental filed counterclaims against Singer and Alliance seeking a declaratory judgment that it had no duty to defend or indemnify. Both parties moved for judgment on the pleadings.

    The central issue in both motions was whether Singer's alleged failures, i.e., failing to close the valve of the propane tank and/or failing to post warning signs regarding the damaged gas line, fell under the professional services exclusion. The court had to examine the character of the alleged conduct and the nature of the services performed by the insured to determine whether the insured's liability flowed directly from a professional activity.

    On this record, the court could not determine as a matter of law that no material issues of fact existed. Singer, Alliance and Continental all denied each other's material allegations regarding both the home inspection and Singer's duties as a public adjuster. Whether Singer had to make repairs, hire someone to make repairs or simply notify the underlying plaintiff that repairs were needed within a certain time frame was unclear. The extent to which the allegations in the underlying complaint flowed directly from Singer's professional services as a public adjuster was also a disputed issue of fact.

    Accordingly, both motions were denied.