Court Finds Insurance Agents E&O Policy Unambiguous

Suits Between Insurance Agents Excluded by E&O Policy
Post 5197

In Laurence Ziff, individually, and the Ziff agency, LLC v. Allianz Global Risks U.S. Insurance Company f/k/a Fireman's Fund Insurance Company, Civil Action No. 24-10529, United States District Court, D. New Jersey (September 23, 2025) Laurence Ziff and The Ziff Agency, LLC are insurance brokers sued Defendant Allianz Global Risks U.S. Insurance Company for defense and indemnity to a lawsuit alleging defamation.

FACTS:
Insurance Policy:

Plaintiffs purchased several insurance policies from Defendant, including the policy at issue, which provided "Company Sponsored Life Insurance Agents Errors and Omissions Liability Coverage".

Plotkin Lawsuit:

The lawsuit arose from a dispute where David Plotkin and Richard Urbealis sued Plaintiffs in New Jersey state court, alleging defamatory statements made by Plaintiff Ziff during a meeting related to the sale of life insurance policies.

Exclusion K:

Defendant denied coverage based on Exclusion K, which disclaims liability for any claim arising out of disputes with other insurance agents or brokers.

LEGAL PRINCIPLES:
Motion to Dismiss:

Defendant filed a motion to dismiss the Amended Complaint for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6).

Exclusion K Interpretation:

The court found that Exclusion K was unambiguous and applicable, as it excluded coverage for disputes between insurance agents and brokers, including those concerning commissions, fees, and client lists.

ANALYSIS

Exclusionary clauses in insurance policies are narrowly construed. The insurer has the burden to prove that an exclusion applies.  If there is more than one possible interpretation of the language, courts apply the meaning that supports coverage rather than the one that limits it. If the words used in an exclusionary clause are clear and unambiguous, a court will not engage in a strained construction to support the imposition of liability.

Defendant argued that the Plotkin Lawsuit was a dispute between insurance agents and brokers and that therefore Exclusion K must apply. Plaintiffs concede that Plotkin and Urbealis are “insurance agents” but contend that Plotkin and Urbealis did not sue Plaintiffs as insurance brokers or insurance agents and did not act as insurance brokers or insurance agents in the placement of the life insurance policies at issue.

Contrary to the allegations the record clearly demonstrated that Urbealis and Plotkin were acting as insurance agents when trying to sell life insurance policies to Kurtz.  Since the language of Exclusion K is unambiguous and applies here Plaintiffs were not entitled to coverage under the Policy and failed to state a claim upon which relief could be granted under Rule 12(b)(6).

CONCLUSION

Defendant's motion to dismiss was granted because a court may dismiss a claim with prejudice when leave to amend would be futile. Because Plaintiffs failed to identify any way in which they would be entitled to coverage under the Plan, amending their complaint for a second time would be futile so the case was dismissed.

ZALMA OPINION

Insurance policies are contracts whose terms and conditions, when brought to a court, are interpreted by the court. The Allianz policy excluded disputes between agents and brokers in language that was clear and unambiguous and the dispute was a result of claims made by insurance agents or brokers against the insured insurance agent. No coverage was obvious.

(
c) 2025 Barry Zalma & ClaimSchool, Inc.

Please tell your friends and colleagues about this blog and the videos and let them subscribe to the blog and the videos.

Subscribe to my substack at https://barryzalma.substack.com/subscribe

Go to X @bzalma;  Go to Barry Zalma videos at Rumble.com at https://rumble.com/account/content?type=all; Go to Barry Zalma on YouTube- https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg; Go to the InsuranceClaims Library – https://lnkd.in/gwEYk.