Promissory Estoppel Claim Thwarted on Agency Theory by TT&H Attorney Burke McLemore

TT&H Attorney Burke McLemore secured a win against a claim that workers’ compensation coverage was afforded by reason of ‘promissory estoppel.’ The case involved a seriously injured Claimant who was employed by the erstwhile ‘insured.’ A policy had previously been issued to the insured, but the insured had not renewed the policy.  The case turned on “who” the insured’s insurance agent was serving when renewal time arrived.  The employee worked for a cable installation company which had been subcontracted by a larger cable company to perform installations.

When the lack of insurance became evident, the larger cable company was brought into the case as the ‘statutory employer’ of the Claimant. This company argued that since notice of expiration of the policy had not been transmitted directly to the insured the policy automatically renewed based on a theory of promissory estoppel.

The defense prevailed upon proof that the agent knew of the expiration; and since the agent was the ‘agent’ of the insured, knowledge of the need to renew was imputed to the insured.

Questions about this case can be directed to Burke McLemore at (717) 255-7647 or bmclemore@tthlaw.com.