The Tenth Circuit Court of Appeals recently held in Sewell v. Great Northern Insurance Company that an insurance broker has no responsibility to advise an insured to procure excess uninsured/underinsured motorist (UM/UIM) coverage in an umbrella policy in addition to the coverage selected in an underlying automobile policy.

In 2001, Marla Sewell used the services of Professional Lines Insurance Brokerage (PLI) to procure automobile and umbrella insurance coverage for her family. Ms. Sewell did not specifically request any information on UM/UIM coverage. PLI sent her quotations for coverage, from which she selected an automobile policy with $300,000 of UM/UIM coverage, and an umbrella policy with no excess UM/ UIM coverage. PLI then prepared and sent written materials including the umbrella policy with blank spaces indicating that Ms. Sewell had not elected to procure the optional excess UM/UIM coverage. Ms. Sewell read the materials, signed the policy, and returned it without making any changes.

In 2004, Ms. Sewell’s husband was killed when his car was struck by an escaping felon in a high-speed police chase. The Sewells submitted a claim for excess UM/UIM benefits, but it was denied by the excess insurer because they never purchased excess UM/UIM coverage.

The Sewells asserted numerous Colorado common law and statutory claims against PLI based on PLI’s alleged failure to procure excess UM/UIM coverage on their behalf. Following removal of the case, the federal district court granted PLI’s motion for summary judgment because the Sewells received precisely the coverage they requested, and because PLI, as their agent, neither misrepresented any information regarding the policy nor otherwise breached any duty to affirmatively advise or warn the Sewells regarding their coverage. The appellate court affirmed summary judgment for PLI on all claims, agreeing with the trial court that the standard insurer-insured relationship between PLI and the Sewells required no more of PLI than to obtain the specific coverages requested and to answer any question brought to its attention, which is what PLI did.