USDC found that the complaint in Robert W. Heidingsfelder against Ameriprise Auto & Home Insurance, et al ., Case No. 19-cv-08255-JD, United States District Court Northern District of California (September 24, 2020 ) was incomprehensible and a little meaningful, but after prolonged kindness, they told the complainants how to change their complaint in order to avoid complete dismissal.
Robert and Ann Heidingsfelder lost their home and personal belongings. in Tubbs Fire 2017, one of the most destructive fires in California history. They had homeowners insurance through the defendants Ameriprise Auto & Home Insurance (Ameriprise), IDS Property Casualty Insurance Company (IDS), and Costco Insurance Agency, Inc. and Costco Wholesale Corporation (Costco), which did not cover all of their alleged losses. The complaint is that the defendants incorrectly presented their coverage levels and did not assess their coverage needs adequately. Heidingsfelders asserts a variety of California state claims for professional negligence, fraud, breach of contract and the like.
Costco, the well-known national retailer, made Ameriprise insurance available to its members, such as Heidingsfelders. Heidingsfelders bought this insurance for his home. They bought by phone by calling a number provided by Costco.
During the purchase of the policy, Heidingsfelders was told that they could receive sufficient coverage to protect their property. Heidingsfelders received a follow-up letter from Costco and Ameriprise that contained a state-authorized notice of potential risks from insuring a home "for less than its compensation cost." The notice contained this warning:
REQUIREMENTS SUPPORT : After a major disaster, construction costs can increase dramatically due to the unusually high demand for contractors, building materials and construction work. This effect is called demand. Demand can increase the cost of remodeling your home. Consider raising your coverage limits or purchasing coverage for increased compensation costs to prepare for this opportunity.
Heidingsfelders received other notices stating that respondents "may" send an independent inspector to determine if their home was undervalued and advise that their home be insured for reconstruction costs. In 2017, Heidingsfelder's defendant asked to evaluate whether their insurance coverage is sufficient. The defendants argued that, on the basis of an internal analysis, Heidingsfelder's coverage was adequate and provided estimates for reconstruction. In October 2017, Heidingsfelder's home and personal belongings in Tubbs Fire were destroyed. Their homeowners policy did not pay for all compensation costs for their homes and property.
The complaint lumps all the respondents together without distinguishing them in a meaningful way. The complaint did not follow the rule that requires it to be stated which respondent did what and when, for the accounts that sounded fraud.
The contract claims are also not appealed. The complaint does not state the express terms of the agreement or the policy that is alleged to have been violated, the relevant policy boundaries or even the parties to the agreement. These omissions are particularly problematic for Costco. It is not claimed that any facts indicate that Costco had a contractual relationship with Heidingsfelders, and it is not at all clear why Costco may be subject to breach of contract or policy requirements. In the absence of this basic information, a reasonable breach of the contract claim cannot be found. So too for the violation of the implied duty of good faith.
Administrative and other customs requirements are not supported either. As a general rule in California, it is up to the insured to determine if he or she has adequate coverage for his or her needs. It is the insured's obligation to inform the representative of the insurance he needs. Heidingsfelders admits that the defendants only said that they "may" inspect Heidingsfelders' home, but did not promise to do so.
An insurance agent has an obligation to use reasonable care, diligence and judgment in obtaining the insurance requested by an insured ”, but not an obligation to provide the insured with advice on specific insurance issues. An insurance agent undertakes a major obligation only by: (1) express agreement, (2) staying out of having special expertise in the relevant insurance field, (3) incorrect presentation of the scope or extent of coverage, or (4) responding to a request from the insured for a certain type of coverage. The complaint does not provide sufficient facts to satisfy these elements.
The parties offered declarations and present much more than anything in the complaint. The Court refused to take them into account at this stage, and the parties are urged not to use the same approach for future submissions. The complaint is rejected with the right to change.
Insurance agents only need to buy the ordered insurance unless it consciously undertakes the obligation to provide advice as a trustee. Fraud requires intent. Bad faith requires intentional action to deprive the insured of the benefits of the insurance. The facts only show that the insured were told of their obligation to insure the cost of replacing the structure and content and not the obligation of the insurer or agents. Why Costco was sued because it informed the insured about a telephone number where it could buy insurance was not meaningful to the court and neither to me. Perhaps, with the advice of the court, Heidingsfelder's lawyer will be able to assert a viable lawsuit against some of the defendants. If this is not the case, the dismissal will take place without leave. Catalog
© 2020 – Barry Zalma. He also acts as an arbitrator or mediator for insurance-related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims lawyer and more than 52 years in the insurance business. He is available at http://www.zalma.com and firstname.lastname@example.org.
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