VictimsGuide • Wyoming Insurance Law

Insurance Agents, Applications & Failure to Procure Coverage

When an insurance policy does not contain the protection an insured expected, the answer depends on what coverage was actually requested, what the agent undertook to obtain, what the insurer agreed to issue, what the written policy says, and whether the insured reviewed the resulting insurance documents.

Wyoming Places Responsibilities on Both Sides An insurance agent who undertakes to procure specified coverage must use reasonable skill, care and diligence. The insured also has a duty to read the resulting insurance documents and timely correct coverage that does not match what was requested.

Three Different Insurance Problems

Failure to Procure

The insured specifically requested coverage, the agent undertook to obtain it, but the required insurance was never procured.

Failure to Recommend

The insured never specifically requested the missing coverage but later argues that the agent should have identified the risk and recommended it.

Policy Does Not Match the Request

Coverage was discussed or requested, but the insurance documents issued by the carrier contain something different.

Agent Representation Conflicts With Policy

An agent says coverage exists, but the written policy contains an exclusion, different limit or missing endorsement.

The Agent's Procurement Duty

Wyoming recognizes that an insurance agent or broker who undertakes to obtain insurance for another owes a duty to exercise reasonable skill, care and diligence in procuring the agreed coverage.

Depending on the circumstances, failure to perform that undertaking can support contract or negligence theories.

Specific Requests Matter The stronger procurement question is: “Did the insured request identifiable coverage and did the agent agree to obtain it?” That is much more precise than: “Should the agent have known I might someday want more insurance?”

The Ordinary Agent Is Not Automatically Your Risk Manager

Wyoming does not impose a general continuing obligation on every ordinary insurance agent to continuously analyze the insured's life or business, identify every possible coverage gap and redesign the insurance program.

A special relationship may potentially support a broader duty, but the ordinary agent-insured relationship standing alone is not sufficient.

Do Not Rely on “Full Coverage”

“Full coverage” is not a defined package of Wyoming automobile insurance.

Specify the coverage you want and verify that it appears on the policy.

A Better Automobile Insurance Request

Instead of Saying	Confirm Specifically
“Give me full coverage.”	Liability limits, UM, UIM, MedPay, collision, comprehensive, rental and desired deductibles.
“Add my new car.”	Exact VIN, effective date, each coverage and each limit.
“My employee can drive it.”	Confirm the driver is not subject to a named-driver exclusion.
“I use it for work sometimes.”	Disclose the actual business use and obtain written confirmation of the resulting coverage.
“We have an umbrella.”	Verify the automobile risk is scheduled or otherwise covered and that required underlying limits are satisfied.

The Insured Has a Strong Duty to Read the Policy

Wyoming repeatedly holds that an insured receiving insurance documents must review them and reject or correct coverage that does not conform to what was expected or requested.

Failure to do so can bar negligence and contract claims against the insurer or insurance agent.

The Coverage Verification Workflow

Make the request specifically. Identify the coverage, vehicle, driver, limit and desired effective date.

Preserve the request. Email, application, text, proposal or other written documentation is better than an undocumented recollection.

Obtain confirmation. Binder, endorsement, declarations page or other insurance document.

Read the issued policy. Compare the document against what was requested.

Correct discrepancies immediately. Do not wait until after a crash to challenge a missing vehicle, driver, coverage or limit.

Verify every renewal. Confirm that important coverage has not been removed, reduced or changed.

A Requested Change Is Not the Same as an Issued Change

If an agent says an endorsement or policy change is coming, review the insurance currently in force until the new document actually arrives.

Do not assume a future correction has already changed today's policy.

Agent Liability Still Requires Causation and Damages

Showing that an agent made a mistake is not necessarily enough.

The claimant must connect the procurement failure to a compensable loss.

The Practical Measure Ask what protection would have existed if the agreed insurance had actually been obtained and whether the particular loss would have been paid under that coverage.

Reformation Is a Different Remedy

In limited circumstances, a court can reform a written insurance contract where the writing fails to reflect an agreement the insurer and insured actually reached before the policy was reduced to writing.

Reformation ordinarily requires clear and convincing evidence of:

a prior meeting of the minds;
a written insurance agreement; and
a mutual mistake causing the writing not to reflect that agreement.

An Agent's Promise Does Not Automatically Rewrite the Insurer's Contract

Reformation cannot ordinarily be used merely because the insured expected greater protection.

There must have been an actual antecedent agreement with the party whose contract is being reformed.

When a Coverage Discrepancy Appears

insurance application
agent proposal
quote
binder
email correspondence
text messages
telephone notes
declarations pages
complete policy
endorsements
renewal notices
premium invoices
proof of premium payment
requested limits
requested drivers
vehicle VINs
named-driver exclusions
UM rejection documents
UIM selection
agent licensing/agency relationship

Leading Wyoming Authorities

Hursh Agency, Inc. v. Wigwam Homes, Inc., 664 P.2d 27 (Wyo. 1983) Foundational Wyoming failure-to-procure authority. An agent or broker who undertakes to obtain insurance must exercise reasonable skill, care and diligence in causing the agreed coverage to be issued.

Arrow Construction Co. v. Camp, 1992 WY 26, 827 P.2d 378 Reaffirms the procurement duty but demonstrates that liability also requires resulting damages causally connected to the agent's breach.

Feather v. State Farm, 1994 WY 48, 872 P.2d 1177 Major automobile authority enforcing the insured's duty to review declarations and renewal notices and correct a vehicle-coverage discrepancy within a reasonable time.

Gordon v. Spectrum, Inc., 1999 WY 75, 981 P.2d 488 Holds that an ordinary agent-insured relationship does not create a broad continuing duty to discover every possible coverage gap. A special relationship may present a different inquiry.

Cordero Mining Co. v. USF&G, 2003 WY 48, 67 P.3d 616 Applies Wyoming's duty-to-read doctrine where insurance was supposed to identify an additional insured and confirms that the defense can apply to procurement claims involving the agent.

W.N. McMurry Construction Co. v. Community First Insurance, 2007 WY 96, 160 P.3d 71 Reaffirms that failure to read insurance documents can bar ordinary tort and contract procurement claims while distinguishing the equitable remedy of reformation.

Ohio Casualty v. W.N. McMurry Construction, 2010 WY 57, 230 P.3d 312 Further develops Wyoming's duty-to-read and reformation rules and shows why an agent's mistaken representation does not necessarily establish an antecedent agreement by the insurer.

Broderick v. Dairyland Insurance Co., 2012 WY 22, 270 P.3d 684 Critical automobile consumer case. Asking for “full coverage” did not establish UIM protection where the issued policy contained no UIM, and Wyoming's strong duty-to-read doctrine barred the claims presented.