## Facts

- Dennis and Susan Langwith obtained most of their insurance through Janet Fitzgerald, a captive agent for American National, including a $250,000 auto liability policy and a $3,000,000 personal umbrella policy covering their family, including their son Ben.
- After Ben’s driver’s license was suspended, the insurer removed him from the auto policy and sought to cancel the umbrella policy; the umbrella remained in force after the Langwiths signed a driver exclusion barring umbrella coverage for losses while Ben drove.
- When Ben’s license was later reinstated, Susan contacted Fitzgerald about Ben’s coverage; Fitzgerald procured a high-risk auto policy for Ben with a $250,000 liability limit, but the umbrella’s Ben-driver exclusion remained in place.
- Ben later caused a serious accident while driving Dennis’s vehicle; an injured passenger sued Ben for negligence and Dennis on a vicarious-liability theory.
- The insurer denied umbrella coverage based on the exclusion, exposing the Langwiths to potential liability above the auto limits.
- Dennis and Ben sued Fitzgerald for negligence (failure to advise about the continuing umbrella exclusion and resulting gap) and sued American National on a vicarious-liability theory.
- The district court granted summary judgment for Fitzgerald and American National, ruling the agent owed only a general duty to procure the insurance requested and no broader duty to advise or provide “risk-management” counseling.

## Issues

1. Whether an insurance agent’s duty of reasonable care is limited, as a matter of law, to procuring the insurance requested by the insured.
2. Whether, based on the parties’ relationship and the agent’s undertaking, the agent may owe a duty to advise the insured about the status of coverage and known gaps (including a continuing exclusion).
3. Whether summary judgment was proper on the insureds’ negligence and vicarious-liability claims given evidence of reliance on the agent for insurance advice.

## Decision

- The Iowa Supreme Court reversed the grant of summary judgment in part and affirmed in part.
- The court held Iowa law does not impose a rigid rule confining an agent’s duty to procurement in every case; the duty’s scope depends on the relationship and circumstances.
- The court concluded defendants failed to establish as a matter of law that Fitzgerald owed no duty to advise regarding the umbrella policy’s continued exclusion, because a jury could find a broader advisory undertaking and reasonable reliance.
- The court affirmed the district court’s rulings rejecting broader, open-ended “risk-management” theories and other challenged rulings not tied to advising on the umbrella exclusion.
- The case was remanded for further proceedings on the duty-to-advise theory and related vicarious liability.

## Legal Principles

- An insurance agent’s duty of reasonable care is not categorically limited to procuring the coverage expressly requested; the scope may expand based on the agent’s undertaking and the insured’s reasonable reliance.
- A duty to advise is not automatic; it may arise when the facts show an advisory relationship (e.g., long-standing entrustment, the agent holding out as a counselor, or awareness of a likely client misunderstanding about coverage).
- Summary judgment is improper when record evidence would allow a fact-finder to conclude the agent undertook to advise about coverage and the insured relied on that undertaking.
- Courts may reject theories that would convert insurance agents into general guarantors of optimal coverage absent a demonstrated undertaking and reliance tied to specific advice.

## Conclusion

The court held that an insurance agent’s negligence duty can include advising an insured about a continuing exclusion and resulting coverage gap when the relationship and facts support an advisory undertaking and reliance; it therefore allowed that limited duty-to-advise claim to proceed while rejecting broader “risk-management” liability theories.


Langwith v. Am. Nat'l Gen. Ins. Co., 793 N.W.2d 215 (Iowa 2010)