Title: Thomas Avery v. Drew Diedrich

State: wisconsin

Issuer: Wisconsin Supreme Court

Document:

2007 WI 80 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2005AP1730 
COMPLETE TITLE: 
 
 
Thomas Avery and Mary Avery, 
          Plaintiffs-Respondents-Petitioners, 
     v. 
Drew Diedrich, The Diedrich Agency, Inc. and 
Westport Insurance Corporation, 
          Defendants-Appellants. 
 
 
 
 
 
REVIEW OF A DECISION OF THE COURT OF APPEALS 
2006 WI App 144 
Reported at: 294 Wis. 2d 769, 720 N.W.2d 103 
(Ct. App. 2006-Published) 
 
 
OPINION FILED: 
June 27, 2007   
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
March 2, 2007   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Fond du Lac   
 
JUDGE: 
Dale L. English   
 
 
 
JUSTICES: 
 
 
CONCURRED: 
ABRAHAMSON, C.J., concurs (opinion filed). 
BRADLEY and BUTLER, JR., JJ., join concurrence.   
 
DISSENTED: 
        
 
NOT PARTICIPATING:         
 
 
 
ATTORNEYS: 
 
For 
the 
plaintiffs-respondents-petitioners 
there 
were 
briefs by Daniel S. Davis, Leah M. Michaelson-Link, and Davis & 
Gelshenen, LLP, Milwaukee, and oral argument by Daniel S. Davis. 
 
For the defendants-appellants there was a brief by Mark S. 
Nelson, 
Heather 
A. 
Lutzke, 
and 
Nelson, 
Connell, 
Conrad, 
Tallmadge & Slein, S.C., Brookfield, and oral argument by Mark 
S. Nelson. 
 
An amicus curiae brief was filed by William C. Gleisner, 
III and the Law Offices of William C. Gleisner III, Milwaukee, 
and Timothy M. Barber and Hanaway Ross, S.C., Green Bay, on 
behalf of the Wisconsin Academy of Trial Lawyers. 
 
An amicus curiae brief was filed by Daniel W. Hildebrand, 
Dennis P. Birke, and DeWitt Ross & Stevens S.C., Madison, on 
 
 
2 
behalf of Professional Insurance Agents of Wisconsin, Inc., 
Independent Insurance Agents of Wisconsin, Inc., and National 
Association of Insurance and Financial Advisors – Wisconsin. 
 
 
2007 WI 80
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.  2005AP1730  
(L.C. No. 
2004CV6) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
Thomas Avery and Mary Avery, 
 
          Plaintiffs-Respondents-Petitioners, 
 
     v. 
 
Drew Diedrich, The Diedrich Agency, Inc. and 
Westport Insurance Corporation, 
 
          Defendants-Appellants. 
 
 
 
FILED 
 
JUN 27, 2007 
 
David R. Schanker 
Clerk of Supreme Court 
 
 
 
 
 
REVIEW of a decision of the Court of Appeals.  Affirmed. 
 
¶1 
JON P. WILCOX, J.   This is a review of a published 
court of appeals decision, Avery v. Diedrich, 2006 WI App 144, 
294 Wis. 2d 769, 720 N.W.2d 103.  The court of appeals reversed 
an order of the Fond du Lac County Circuit Court, Dale L. 
English, Judge, which denied the motion for summary judgment 
made by Drew Diedrich, The Diedrich Agency, Inc. (collectively, 
Diedrich) and Westport Insurance Corporation (Westport). 
¶2 
This appeal presents the following question: If an 
insured requests an increase in insurance coverage and the 
No. 
2005AP1730   
 
2 
 
insurance agent has not agreed to procure it, does the agent 
have a duty to procure it?  We hold that an insurance agent does 
not have a duty to procure requested insurance coverage until 
there is an agreement that the agent will do so.  Accordingly, 
we affirm the court of appeals. 
I 
¶3 
Early in 2002 Mary Avery received a residential 
property located at W3283 Orchard Avenue, Green Lake, Wisconsin, 
(the Orchard property) from her father's real estate trust.1  Her 
parents had used the four bedroom residence as a vacation home.  
Soon after receipt, Mary Avery transferred the Orchard property 
to the Cedar Ridge Real Estate LLC, an entity owned by her and 
her husband, Thomas Avery. 
¶4 
Thomas Avery contacted Diedrich to arrange replacement 
cost coverage on the Orchard property.  Drew Diedrich, part-
owner and president of The Diedrich Agency, Inc., had been the 
Averys' insurance agent since 1996.  He had arranged for a 
number of different types of policies for the Averys, including 
an 
equine 
professional 
policy, 
a 
farm 
owners 
policy, 
a 
commercial automobile policy, and several policies for rental 
properties. 
¶5 
Thomas Avery requested $150,000 worth of coverage for 
the Orchard property, the same amount of coverage that Mary's 
father had previously had for the property.  Diedrich bound the 
                                                 
1 For purposes of the motion for summary judgment, Diedrich 
and Westport stipulated to the Averys' version of the facts. 
No. 
2005AP1730   
 
3 
 
coverage with Auto-Owners Insurance Company.  He then filled out 
and submitted an application with the specifications of the 
Orchard property.  After binding the coverage and submitting the 
application, Diedrich visited the property and confirmed its 
value.  His confirmation of the property's value included 
measuring the exterior of the building, noting the roof type, 
and taking a photograph of the property.  According to 
Diedrich's 
evaluation, 
the 
$150,000 
coverage 
limit 
was 
appropriate. 
¶6 
In July 2002 the Averys met with Diedrich to review 
the various coverages they had purchased through him.  Such 
meetings occurred on an annual basis.  At the meeting, the 
Averys asked Diedrich to increase the coverage limit on the 
Orchard property from $150,000 to at least $250,000.  Based on 
their experience building a home, the Averys believed that the 
property was worth $250,000 or more. 
¶7 
Diedrich disagreed that a $100,000 coverage increase 
was justified based on the value of the Orchard property.  He 
thought the cost to replace the property would not exceed the 
existing level of coverage.  Diedrich also thought that a 
$100,000 coverage increase would be suspicious to the insurance 
company. 
¶8 
The Averys and Diedrich failed to reach an agreement 
on whether Diedrich would procure additional insurance coverage 
for the Orchard property.  The idea of having an independent 
valuation of the property done came up as a means of resolving 
the disagreement.  The Averys planned to contact an independent 
No. 
2005AP1730   
 
4 
 
contractor that had been involved in building their residence to 
get such appraisal.  In the meantime, the property continued to 
be insured at the $150,000 level. 
¶9 
In the weeks following the meeting, Diedrich sent the 
Averys 
a 
letter 
summarizing 
what 
they 
had 
discussed.  
Specifically, the letter noted that the Averys planned on 
contacting a contractor to evaluate the property and determine 
whether the increased insurance coverage was justified. 
¶10 The 
Averys' 
independent 
contractor 
examined 
the 
property and determined that the coverage limit should be at 
least $250,000.  The contractor's assessment was given to the 
Averys verbally, but they never got a written estimate of the 
property's value.  Neither the Averys nor the contractor 
contacted Diedrich to inform him of the verbal estimate of the 
property's value.  The Averys had no further contact with 
Diedrich regarding the increase of their insurance coverage on 
the Orchard property after the July 2002 meeting and the receipt 
of his follow-up letter.  The Averys also did not attempt to get 
increased coverage for the property through another agent or 
insurance company. 
¶11 In September 2002 a fire destroyed the Orchard 
property.  The Averys allege that cost of replacing the 
residence on the property exceeded $250,000. 
¶12 In 
January 
2004 
the 
Averys 
filed 
suit 
against 
Diedrich, Westport, and Auto-Owners Insurance Company.  The 
complaint alleged that Diedrich was negligent for failing to 
procure the increased coverage for the Orchard property that the 
No. 
2005AP1730   
 
5 
 
Averys had requested.  The complaint named Westport as a 
defendant because it insured Diedrich against the type of 
liability alleged by the Averys.  The complaint named Auto-
Owners Insurance Company as a defendant because it had issued 
the $150,000 policy for the Orchard property.  The parties 
eventually stipulated to dismiss with prejudice the claims 
against Auto-Owners Insurance Company. 
¶13 During 
discovery, 
Diedrich 
and 
the 
Averys 
were 
deposed.  The attorney for Diedrich and Westport, Mark S. 
Nelson, and Mary Avery had the following exchange during her 
deposition: 
M. Avery: [W]hen 
we 
told 
[Diedrich] 
we 
wanted 
additional insurance, he did not respond 
favorably to our request. 
Nelson: 
And he said, I'm not going to do it; is that 
what you are saying? 
M. Avery: He said, I don't believe the property is 
worth that much, based on my opinion. 
Nelson: 
And so when you left that meeting, you knew 
that there was $150,000 worth of coverage on 
the property, correct? 
M. Avery: Correct. 
Nelson: 
And you knew that Drew Diedrich was not 
going to in the near future increase that, 
absent hearing back from you, correct? 
M. Avery: Correct. 
Nelson: 
You knew that it was your responsibility to 
contact [a contractor] to find out what his 
opinion was with respect to the value or the 
replacement cost of the Orchard property, 
correct? 
No. 
2005AP1730   
 
6 
 
M. Avery: I was annoyed because I've always felt that 
an insurance agent should help its clients 
by following up on such things.  It seemed 
odd to me that the ball was in my court on 
that. 
Nelson: 
But you understood when you left that the 
ball was in your court, correct? 
M. Avery: Yes, yes.  
Nelson and Thomas Avery had the following exchange during his 
deposition: 
Nelson: 
Drew Diedrich did not, according to you, 
agree to increase the policy limits to 250-, 
did he? 
T. Avery: No, he did not. 
Nelson: 
Did you ask him to do it? 
T. Avery: Yes. 
Nelson: 
And according to you then he refused to do 
it, right? 
T. Avery: That's correct. 
Nelson: 
And he, according to you, refused to do it 
on that day, in that meeting, right? 
T. Avery: That is correct. 
Nelson: 
And so that you knew immediately during the 
meeting he wasn't going to increase them, 
correct? 
T. Avery: Yes. 
Nelson: 
And 
you 
left 
the 
meeting 
with 
that 
understanding, correct? 
T. Avery: Yes. 
Nelson: 
And that was your continuous understanding 
until even after the fire, correct? 
T. Avery: That is correct.  
No. 
2005AP1730   
 
7 
 
Nelson: 
And was it you or your wife who contacted 
[the contractor]? 
T. Avery: I believe Mary did. 
  
. . . . 
Nelson: 
And did she go out to the site, to the 
Orchard property, before the fire, with [the 
contractor]? 
T. Avery: We both did. 
¶14 Diedrich and Westport moved for summary judgment on 
the ground that Diedrich had no duty to obtain additional 
coverage for the Averys because he never agreed to obtain the 
additional coverage.  The circuit court denied the motion, 
concluding that Diedrich, as an insurance agent, had a duty to 
carry out the Averys’ instructions.  The circuit court made its 
decision based on Lisa's Style Shop, Inc. v. Hagen Insurance 
Agency, Inc., 181 Wis. 2d 565, 511 N.W.2d 849 (1994); Nelson v. 
Davidson, 155 Wis. 2d 674, 456 N.W.2d 343 (1990); Appleton 
Chinese Food Service, Inc. v. Murken Insurance, Inc., 185 
Wis. 2d 791, 519 N.W.2d 674 (Ct. App. 1994); and Meyer v. 
Norgaard, 160 Wis. 2d 794, 467 N.W.2d 141 (Ct. App. 1991).  It 
noted that prior Wisconsin cases had defined an insurance 
agent's duty relative to an insured's responsibilities.  It 
concluded that once an insured had decided on the coverage he or 
she desired, the agent had a duty to carry out the insured's 
instructions.  
¶15 Diedrich and Westport filed a petition for leave to 
appeal 
a 
non-final 
order 
pursuant 
to 
No. 
2005AP1730   
 
8 
 
Wis. Stat. § 808.03(2)(2005-06),2 which the Averys opposed.  The 
court of appeals granted the petition for leave, concluding that 
the § 808.03(2) criteria were satisfied in this case.   
¶16 The court of appeals reversed the circuit court's 
denial of the motion for summary judgment made by Diedrich and 
Westport.  Based on the same cases that the circuit court relied 
upon, the court of appeals concluded that Diedrich had no duty 
to obtain the increased insurance coverage because there was 
never an agreement that he would.  Because Diedrich agreed to 
procure only the original policy and not the additional 
coverage, he was not bound to carry out the Averys’ request for 
additional coverage.   
¶17 The Averys petitioned for review with this court, 
which we granted. 
                                                 
2 Wisconsin Stat. § 808.03(2) provides the following: 
APPEALS BY PERMISSION.  A judgment or order not 
appealable as a matter of right under sub. (1) may be 
appealed to the court of appeals in advance of a final 
judgment or order upon leave granted by the court if 
it determines that an appeal will:  
(a) Materially advance the termination of the 
litigation or clarify further proceedings in the 
litigation;  
(b) Protect the petitioner from substantial or 
irreparable injury; or  
(c) Clarify an issue of general importance in the 
administration of justice. 
 
All subsequent references to the Wisconsin Statutes 
are to the 2005-06 version, unless otherwise stated. 
No. 
2005AP1730   
 
9 
 
II 
¶18 We review a circuit court's grant or denial of summary 
judgment independently of the circuit court or court of appeals, 
applying the same methodology as the circuit court.  AKG Real 
Estate, LLC v. Kosterman, 2006 WI 106, ¶14, 296 Wis. 2d 1, 717 
N.W.2d 835. Summary judgment is appropriate if there are no 
genuine issues of material fact and the moving party is entitled 
to judgment as a matter of law.  Wis. Stat. § 802.08(2).  
Summary judgment materials, including pleadings, depositions, 
answers to interrogatories, and admissions on file, are viewed 
in the light most favorable to the nonmoving party.  Rainbow 
Country Rentals v. Ameritech Publ'g, 2005 WI 153, ¶13, 286 
Wis. 2d 170, 706 N.W.2d 95. 
¶19 For purposes of the motion for summary judgment made 
by Diedrich and Westport, there is no genuine issue of material 
fact.  Diedrich and Westport have stipulated to the Averys' 
version of the facts for the purposes of their motion. 
¶20 The motion for summary judgment in this case also 
presents a question of law.  The Averys brought a negligence 
claim.  To prevail, they would need to prove four elements: "(1) 
a duty on the part of the defendant; (2) a breach of that duty; 
(3) a causal connection between the conduct and the injury; and 
(4) an actual loss or damage as a result of the injury."  
Nelson, 155 Wis. 2d at 679.  Diedrich and Westport moved for 
summary judgment based on an absence of any duty for an agent to 
procure requested coverage until the agent has agreed to procure 
No. 
2005AP1730   
 
10 
 
it.  Whether such a duty existed presents a question of law.  
Id. 
III 
¶21 In this case, we address the following question: If an 
insured requests an increase in insurance coverage and the 
insurance agent has not agreed to procure it, does the agent 
have a duty to procure it? 
¶22 Numerous 
cases 
have 
addressed 
the 
scope 
of 
an 
insurance agent's duty to an insured.  Although none resolved 
the issue presented in this case, they do provide a framework in 
which to consider the agent's duty to procure coverage.   
¶23 An insurance agent has a duty to "'exercise reasonable 
skill and diligence in the transaction of the business entrusted 
to him [or her].'"  Master Plumbers Ltd. Mut. Liab. Co. v. 
Cormany & Bird, Inc., 79 Wis. 2d 308, 313, 255 N.W.2d 533 
(1977).  Agency law does not insulate an insurance agent from 
liability for his or her torts.  Schurmann v. Neau, 2001 WI App 
4, ¶9, 240 Wis. 2d 719, 624 N.W.2d 157 (citing Ford v. Wisconsin 
Real Estate Examining Bd., 48 Wis. 2d 91, 102, 179 N.W.2d 786 
(1970)).  When an insurance agent fails to act with reasonable 
care, skill, and diligence in procuring coverage he or she 
agreed to procure, the agent has breached his or her duty to the 
insured.  Appleton Chinese, 185 Wis. 2d at 805. 
¶24 In Appleton Chinese, the insureds requested $140,000 
replacement cost coverage on their restaurant and lost business 
income coverage.  The insurance agent agreed to procure the 
requested 
coverage 
and 
prepared 
applications 
to 
various 
No. 
2005AP1730   
 
11 
 
insurers.  Because of a clerical error by the insurance agent, 
the applications that the insureds selected from did not include 
any lost business coverage.  Once the insureds had selected an 
insurer, the insurance agent also agreed to the policy being 
written at actual cash value, rather than as replacement cost 
coverage, without consulting the insureds.  The agent failed to 
ever make the insureds aware that the policy had been written at 
actual cash value.  As a result of the insurance agent's 
conduct, rather than having $140,000 in replacement cost 
coverage and lost business income coverage, the insureds ended 
up with a policy that provided $140,000 in actual cash value 
coverage. 
¶25 The court concluded that the insurance agent had 
breached her duty to act with reasonable skill and diligence in 
procuring the coverage she had agreed to procure for the 
insureds.  Id. at 810.  In reaching its conclusion, the court 
recognized that "[t]he principal-agent relationship may not rise 
to the level of a duty to advise, but it certainly extends to an 
independent duty to act with reasonable care, skill and 
diligence in procuring the agreed upon coverage."  Id. at 805.   
¶26 In addition to establishing when an insurance agent 
has a duty, prior cases have also "recognized that, absent 
special circumstances, an insurance agent's duty to an insured 
is limited."  Sprangers v. Greatway Ins. Co., 182 Wis. 2d 521, 
547, 514 N.W.2d 1 (1994).  For instance, in Nelson, the insured 
alleged that an insurance agent had negligently failed to 
adequately inform them of the availability of underinsured 
No. 
2005AP1730   
 
12 
 
motorist (UIM) coverage.  The court concluded that "an insurance 
agent has no affirmative duty under existing Wisconsin law, 
absent special circumstances, to inform an insured concerning 
the availability or advisability of UIM coverage."  Nelson, 155 
Wis. 2d at 685.3 
¶27 Special circumstances exist when something more than a 
standard insured-insurer relationship exists, such as an express 
agreement that an agent will advise the insured about his or her 
coverage.  Id. at 683.  Special circumstances may also arise if 
an insured pays the agent compensation for his or her advice, an 
insured has entrusted the agent to an extent that the agent 
appreciates that he or she has an enhanced duty of providing 
advice, or the insured relies on advice after an agent held 
himself or herself out as a highly skilled insurance expert.  
Id. at 683-84. 
¶28 Courts have also concluded that in the absence of 
special circumstances insurance agents do not have a duty to 
"inform about or recommend policy limits higher than those 
selected by the insured," Meyer, 160 Wis. 2d at 798; "update the 
contents limit of the [insureds'] policy or to advise them 
regarding the adequacy of coverage," Lenz Sales & Service, Inc. 
v. Wilson Mut. Ins. Co., 175 Wis. 2d 249, 254, 499 N.W.2d 229 
                                                 
3 In the years following the court's decision in Nelson v. 
Davidson, 
155 
Wis. 2d 674, 
456 
N.W.2d 343 
(1990), 
the 
legislature enacted 1995 Wisconsin Act 21, which created 
Wis. Stat. § 632.32(4m).  Wisconsin Stat. § 632.32(4m) requires 
that insurers give the insured notice about the availability of 
underinsured motorist coverage. 
No. 
2005AP1730   
 
13 
 
(Ct. App. 1993); "advise [the insured] to increase the limits of 
its insurance coverage for personal property," Lisa's Style 
Shop, 181 Wis. 2d at 567; or "anticipate what liabilities an 
insured may expect a policy to cover or to identify which 
exclusions 
in 
a 
policy 
an 
insured 
may 
deem 
important," 
Sprangers, 182 Wis. 2d at 547. 
¶29 Adhering to the underlying principles of the other 
cases related to the duty of insurance agents, we conclude that 
an insurance agent does not have a duty to procure requested 
insurance coverage until there is an agreement that the agent 
will do so.  
¶30 In this case, it is undisputed that there was not an 
agreement that Diedrich would procure the $100,000 increase in 
coverage for the Averys.  During the July 2002 meeting and in 
the follow-up letter, Diedrich made clear that he was not 
procuring the additional coverage unless the Averys provided him 
with another estimate of the Orchard property's value.   
¶31 Both the Averys, during their depositions, recognized 
that Diedrich had not agreed to procure the coverage they had 
requested at the July 2002 meeting.  They also articulated their 
belief that Diedrich was not going to procure the increased 
coverage until he heard back from them with a new appraisal of 
the Orchard property.  Although the Averys received an estimate 
that would have supported the increase in coverage, they never 
gave Diedrich that information.  The necessary agreement could 
not have occurred until Diedrich and the Averys agreed that 
Diedrich would procure the $100,000 increase in coverage.  Such 
No. 
2005AP1730   
 
14 
 
an agreement never occurred.  Accordingly, we conclude that 
Diedrich did not have a duty to procure the requested increase 
in coverage. 
¶32 The Averys contend that an insurance agent who has 
agreed to procure coverage for a property has a duty to procure 
any requested increase in coverage for that given property.  
Such a duty arises, according to the Averys, because agents are 
obligated to carry out an insured's instructions once the 
insured has made a decision about his or her insurance needs. 
¶33 We reject the Averys' proposed rule.  Such a rule 
would permit an insured to unilaterally impose a duty on an 
insurance agent once the agent has agreed to provide any 
coverage for a property.  There are not any Wisconsin cases that 
recognize that an insurance agent could have a duty imposed 
unilaterally.  Contrary to the Averys' suggestion, the Appleton 
Chinese insurance agent breached her duty because of her 
negligence after she had agreed to procure the requested 
coverage.  Appleton Chinese, 185 Wis. 2d at 805.  The Appleton 
Chinese 
court 
recognized 
that 
"[t]he 
principal-agent 
relationship may not rise to the level of a duty to advise, but 
it certainly extends to an independent duty to act with 
reasonable care, skill and diligence in procuring the agreed 
upon coverage."  Id. (emphasis added). Permitting unilateral 
changes to the principle-agent relationship is inconsistent with 
the principles previously articulated by Wisconsin courts.  
E.g., Nelson, 155 Wis. 2d at 684.    
No. 
2005AP1730   
 
15 
 
¶34 Our conclusion in this case is consistent with those 
reached in other jurisdictions that have considered the issue 
presented in this case.   Specifically, other jurisdictions have 
concluded that an insurance agent's duty in the context of 
procuring coverage arises when he or she has agreed to procure 
the requested coverage.  R.H. Grover, Inc. v. Flynn Ins. Co., 
777 P.2d 338, 341 (Mont. 1989); Baldwin v. Lititz Mut. Ins. Co., 
393 S.E.2d 306, 308 (N.C. Ct. App. 1990). 
¶35 In addition to other jurisdictions reaching the same 
conclusion, treatises support our position.  Couch on Insurance 
states the following:   
[a]n insurance agent is not obligated to assume the 
duty of procuring a policy of insurance for a 
customer, 
but 
if 
the 
agent, 
with 
a 
view 
to 
compensation for his or her services, undertakes to 
procure insurance for a customer and fails to do so, 
the insurance agent will be held liable for any damage 
resulting therefrom.   
3 Lee R. Russ & Thomas F. Segalla, Couch on Insurance § 46:46 
(3d ed. 2005).  Like our conclusion in this case, Couch on 
Insurance provides that an insurance agent does not have a duty 
to procure requested insurance coverage.  Another treatise 
states that an insurance agent owes the insured no duty until 
the agent "agrees to undertake a particular task."  Clarance E. 
Hagglund et al., Insurance Producer Liability: In Plain Language 
17 (1991).  After an insurance agent "agrees to procure 
insurance, [his or her] duties are limited to (1) following the 
[insured's] coverage instructions with reasonable care, and (2) 
not intentionally or negligently misrepresenting the scope of 
No. 
2005AP1730   
 
16 
 
coverage."  Id. (footnotes omitted).  These treatises support 
our holding that an insurance agent does not have a duty to 
procure requested insurance coverage until there is an agreement 
that the agent will do so. 
IV 
¶36 In sum, we hold that an insurance agent does not have 
a duty to procure requested insurance coverage until there is an 
agreement that the agent will do so.  In this case, Diedrich did 
not have a duty to procure the $100,000 increase in insurance 
coverage requested by the Averys because he never agreed to 
procure the increased coverage.  There was no genuine issue of 
material fact and Diedrich and Westport were entitled to 
judgment as a matter of law.  Accordingly, summary judgment for 
Diedrich and Westport was appropriate. 
By the Court.—The decision of the court of appeals is 
affirmed. 
 
 
No.  2005AP1730.ssa 
 
1 
 
 
¶37 SHIRLEY S. ABRAHAMSON, C.J.   (concurring).  The court 
phrases the question presented as follows: "If an insured 
requests an increase in insurance coverage and the insurance 
agent has not agreed to procure it, does the agent have a duty 
to procure it?"  Majority op., ¶2.  The majority opinion answers 
this easy question "No."  Majority op., ¶2.  I agree with the 
answer to the question posed.  
¶38 Nevertheless, I am concerned because, in my opinion, 
the facts and parties present a more nuanced question than the 
one the majority opinion answers.  In my opinion, the following 
question is presented by the instant case: If an insured and 
insurance agent have a pre-existing relationship and a course of 
past dealing, and if the insured asks the agent to procure 
increased insurance coverage on an existing insurance policy and 
the agent explicitly refuses to procure the requested increased 
insurance coverage but their relationship continues, is the 
insurance agent liable to the insured when a loss occurs in 
excess of the policy coverage?  The majority opinion does not 
answer this question. 
¶39 According to the court of appeals, an insurance 
agent's duty to the insured includes a duty to act with 
reasonable care, skill, and diligence in procuring the agreed-
upon coverage and a duty to act in good faith and follow the 
insured's direction.  Avery v. Diedrich, 2006 WI App 144, ¶¶9, 
11, 294 Wis. 2d 769, 720 N.W.2d 103.  In the present case, no 
increased coverage was agreed upon between the insurance agent 
No.  2005AP1730.ssa 
 
2 
 
and the insured.  Because the insurance agent explicitly advised 
the insured that the agent would not follow the insured's 
direction, would not procure the requested increased coverage, 
and did not accept the obligation to procure the increased 
coverage, the insurance agent was not liable for failing to 
procure the increased coverage, according to the court of 
appeals.  Avery, 294 Wis. 2d 769, ¶¶10, 12. 
¶40 The circuit court viewed the case differently and 
denied the insurance agent's motion for summary judgment.1  The 
circuit court recognized that unless "special circumstances" 
exist, an insurance agent has limited duties to the insured.  
For example, absent special circumstances, an insurance agent 
ordinarily does not have the duty to advise the insured 
regarding 
available 
insurance. 
 
What 
constitutes 
special 
circumstances has been addressed by this court in Nelson v. 
Davidson, 155 Wis. 2d 674, 456 N.W.2d 343 (1990).  The circuit 
court concluded as a matter of law that no special relationship 
existed between the insured and the insurance agent in the 
present case.  Neither party argues in this court that the 
relationship between the insured and the agent amounted to 
special circumstances. 
¶41 The circuit court, however, also recognized that 
insureds have the burden to know their insurance needs and the 
value of their property, and to communicate requests for 
coverage to their insurance agents.  The insurance agent's duty 
in the present case, according to the circuit court, was to 
                                                 
1 Fond du Lac County Circuit Court, Dale L. English, Judge. 
No.  2005AP1730.ssa 
 
3 
 
follow the insured's instructions, which included at a minimum 
presenting the insured's request to the insurance company and 
allowing the company to decide whether to write the requested 
increased coverage.  Because the insurance agent failed to honor 
the insured's request by not forwarding the request to the 
insurance company, the insurance agent may be liable for breach 
of the duty under the circuit court's decision. 
¶42 The instant case presents, in my opinion, the question 
of the scope of an insurance agent's duty when the parties have 
a pre-existing relationship and a course of dealing with each 
other.  To reach a decision on the question I framed, a court 
would have to address, in my opinion, the following arguments 
(among others) raised in the present case:  (1) Did the pre-
existing relationship impose a duty on the agent to adhere to 
the insured's request for increased coverage or at least to 
forward the request to the insurance company?  (2) Was the 
insurance agent a dual agent, that is, an agent for both the 
insured and the insurance company, and how does a dual agency 
affect the relationship between the insured and the agent and 
the agent's obligations in the present case?  (3) If the 
insurance agent refuses to follow the insureds' instructions, 
must the insurance agent terminate the agency relationship?  (4) 
Do judicial public policy factors limit or expand the insurance 
agent's liability in the present case? 
¶43 The majority opinion perhaps will be interpreted as 
supplying a "No" answer to the question I framed.  Or perhaps 
the majority opinion will be interpreted as not grappling with 
No.  2005AP1730.ssa 
 
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the actual fact situation underlying the present case.  In that 
event, the question raised by the facts of the present case 
probably remains unanswered in Wisconsin law and will have to 
await a definitive answer from this court on another day.   
¶44 For the reasons set forth, I write separately.   
¶45 I am authorized to state that Justices ANN WALSH 
BRADLEY and LOUIS B. BUTLER, JR. join this opinion. 
 
 
No.  2005AP1730.ssa 
 
 
 
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