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Janeen A. Javoroski v. Selectquote Insurance SVC, Inc., et al.,
Index No. 4542-16 (Sup. Ct., Albany Co., February 21, 2017) (Richard M. Platkin, J.)

The Court ruled in favor of Mound Cotton’s clients, insurance broker defendants on their motion to dismiss a complaint pursuant to CPLR 3012(b) for plaintiff’s failure to timely file and serve the complaint, and held that the plaintiff failed to demonstrate either a reasonable excuse for the delay or that her negligence claim against the brokers was a meritorious cause of action.  Plaintiff’s deceased husband was the owner of a 10-year renewable and convertible life insurance policy that lapsed on December 27, 2011 for non-payment of premium.  Thereafter, plaintiff’s husband allegedly contacted the broker defendants to purchase a new 10-year renewable and convertible life insurance policy, which was issued on or about February 19, 2012.  After her husband committed suicide on August 7, 2013, her claim for benefits under the original policy was denied because it had lapsed for non-payment of premium prior to her husband’s death.  Her claim for benefits under the new policy was also denied because the death occurred during that policy’s two-year incontestability period.  The Complaint alleged that the brokers were negligent in selling her husband the new policy after the original had lapsed for non-payment rather than advising him to seek reinstatement of the original policy, which she claimed, but for the brokers’ failure to so advise would have been in force at the time of her husband’s death.

Initially, the plaintiff commenced her action by serving a summons without a complaint on the brokers.  The brokers served a demand for the complaint, and after the time for serving the complaint passed they filed a motion to dismiss the action pursuant to CPLR 3012(b) based on plaintiff’s failure to timely file and serve the complaint.

In response to the brokers’ motion to dismiss, the Court held that even if the plaintiff had proffered a satisfactory excuse for the delay in serving the  Complaint on the defendants, she had not met her burden of establishing a prima facie case of negligence against the brokers.  Guided by the Court of Appeals’ decision in Murphy v. Kuhn, 90 N.Y.2d 266 (1997), the Court held that the brokers were under no duty to advise plaintiff’s husband that he could have reinstated his original life insurance policy instead of purchasing a new one.  The Court therefore held that a broker’s obligation to procure a specific type of coverage does not, as a matter of law, include the reinstatement or renewal coverage that previously lapsed.  The Court found that plaintiff had not alleged that the defendants failed to obtain the coverage requested by the insured (plaintiff’s husband), or that the brokers had assumed additional duties to him.  Accordingly, the Court granted the broker defendants’ motion and dismissed the plaintiff’s Complaint in its entirety.

For inquiries about this decision, contact partner Barry Temkin or associate Kate DiGeronimo.