On Nov. 19, 2012, the New York Court of Appeals in American Building Supply Corp. v. Petrocelli Group Inc. et al. ruled for the first time on the issue of whether an insured’s receipt of the insurance policy without complaint barred an E&O claim against an insurance agent or broker. The Court of Appeals concluded that “The [insured’s] failure to read the policy, at most, may give rise to a defense of comparative negligence but should not bar, altogether, an action against a broker.”

The ruling is a significant decision that is likely to influence other jurisdictions. It is a call to insurance agents and brokers to revisit and fortify their loss control procedures. Consideration should be given to working with their E&O insurers and/or E&O attorneys to tailor procedures to the particular business of the insurance agency or brokerage.

Recommended For You

Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader

Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
  • Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
NOT FOR REPRINT

© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.