Can I hold an insurance agency responsible for a contractor’s damages?

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Can I hold an insurance agency responsible for a contractor’s damages?

I contacted an insurance agency to confirm a contractor’s certificate of insurance – General Liability Insurance policy – was up to date. The contractor had given me a copy of his certificate. I was told by the contractor’s insurance agency’s office that the contractor had an up to date policy. He had full coverage. The contractor caused major damages to my home. I filed a claim with the contractor and also notified his insurance agency of damages caused by their insured. Was now told the insurance agency made a mistake and that the contractor’s insurance policy had been canceled for non payment 7 months prior to my call. The cancellation notice had been “buried” when I called.

Asked on June 25, 2013 under Business Law, Colorado

Answers:

MD, Member, California Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

Yes this is called negligence, fraud and insurance bad faith. What you need to do is a) file a complaint with the state's department of insurance and b) talk to an attorney if a) fails to sue both the contractor and his former insurance company under different theories of liability. Do not sit on it. You might be able to negotiate full replacement value with the insurance company since they would not want bad press or suits against them which are public.


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