A North Carolina insurance agency is facing a lawsuit from a homeowner after his claim was denied due to missing details on his insurance application. The case, which has been ongoing for nearly ten years, has recently gained attention following a decision by the state Supreme Court.
In May, the court ruled that the lawsuit against J. Kim Hatcher Insurance Agency should not be dismissed. This ruling supports a previous decision by a North Carolina appeals court that overturned a trial court’s dismissal of the case in 2021.
The core issue in this case revolves around whether a homeowner is at fault for signing a blank insurance application and trusting their agent to fill it out correctly. Justice Anita Earls, writing for the court, emphasized that this question should be decided by a jury. The Hatcher agency argued that the homeowner, Daniel Jones, was partially responsible for the denial of his claim because he signed the application without reviewing it. However, the justices noted that if clients cannot trust their agents, it undermines the purpose of hiring them.
According to reports, an agent from Hatcher told Jones to simply sign the blank application and pay the first premium, assuring him that the agency would handle the rest. The agency also conducted a property inspection and took photographs. A year later, Jones renewed his insurance policy with GeoVera.
Tragedy struck in September 2018 when Hurricane Florence caused significant damage to Jones’s property, including tearing off shingles and damaging the interior. After initially agreeing to cover the claim, GeoVera later retracted its offer, citing that the application failed to mention a large pond located in front of the house and that the property spanned nearly eight acres, including farmland. The insurer labeled these omissions as material misrepresentations.
Following the denial, Jones decided to take action by suing both the Hatcher agency and GeoVera, claiming negligence and gross negligence. The outcome of this case could have significant implications for homeowners and insurance practices in North Carolina, especially regarding the responsibilities of insurance agents and the trust placed in them by clients.