Sicari v. The Hartford Ins. Co., Superior Ct. N.J., App. Div. (May 10, 2017)
The New Jersey Appellate Division affirmed the Law Division’s grant of summary judgment in favor of MCW&G client, The Hartford Ins. Co. In this case, plaintiff, Vince A. Sicari, Esq., an attorney who runs a law practice, had a Hartford policy in 2010-2011 for commercial general liability, business personal property liability, and lawyers’ professional liability, for which he paid a $2,728 premium. Two months before the policy expired, Hartford sent him a letter advising that it would be reducing his coverage because it would no longer be writing lawyers’ professional liability insurance. Plaintiff testified that he never received that letter. He signed a renewal application for professional liability coverage, to which he never received a response but Hartford issued a policy for the 2011-2012 year that did not include professional liability coverage. The premium was $649, a $2,079 reduction from the prior year. The policy was renewed for the 2012-2013 year, again without the professional liability coverage.
In June 2013, plaintiff was prompted by mass mailings from insurance providers regarding malpractice insurance to ask his broker about his own malpractice coverage. A few weeks later he was advised that his coverage had lapsed. The next month, he learned that there was a potential malpractice case against him.
Plaintiff filed a complaint seeking to compel Hartford to provide retroactive coverage for lawyers’ liability and for the insurance broker to indemnify him for any malpractice liability he would incur during the gap period. The suit against the broker was ultimately dismissed. Plaintiff filed a motion for summary judgment against Hartford and Hartford filed a cross-motion.
The Law Division found that the letter to plaintiff was sufficient to notify him that Hartford would not renew the professional liability coverage and complied with the regulatory requirements for notification of nonrenewal. In addition the court pointed to the significant drop in premium and that there was no mention of professional liability coverage in any of the renewed policies as sufficient notice to plaintiff.
On appeal, plaintiff stressed that the weight of the evidence demonstrated that he never received the letter notifying him of the nonrenewal. In affirming summary judgment for Hartford, the Appellate Division agreed that Hartford had fully complied with New Jersey regulatory requirements for nonrenewal and that plaintiff’s lack of knowledge “of the contents of the notice does not render Hartford non-compliant with the law.” In addition, the Court agreed that plaintiff was charged with knowledge of the policy’s contents. Further, the Court acknowledged that even though it would have been better practice for Hartford to have responded to plaintiff’s renewal application, the mere completion of an application did not obligate Hartford to renew insurance for a type it no longer offered. Moreover, plaintiff should have been on notice of a change in the policy by looking at the declarations page and the sharp drop in premium. “That large premium drop should have been a ‘red flag,’ and plaintiff’s apparent failure to take notice weakens his argument for coverage.”
For inquiries about this case, please contact partner William D. Wilson.