Insured’s Claim Against Broker Fails

    The insured's claim against his broker for failure to secure adequate coverage was dismissed by the federal district court. Galapatos v. Marsh & McLennan Companies, 2025 U.S. Disl. LEXIS 32833 (D. Mass. Feb. 24, 2025). 

    Nicholas Galapatos purchased a boat (Galani) in 2015 to use in Greece. He retained Marsh for the first time in 2008 and relied on them thereafter to procure insurance. 

    Galapatos purchased a one year, $10,000,000 excess policy from AIG. The policy was to provide coverge for losses sustained  "anywhere in the world." Galapatos also purchased third party liability insurance for Galani from Groupama Insurances in May 2018. He contended he disclosed the ownership of Galani and his Groupama Insurance policy to Marsh. 

    In September, 2018, Galani collided with another vessel off the coast of Greece, resulting in damage to both vessels and injuries some passengers aboard the other vessel. Galapatos informed Marsh of the accident. Galapatos was sued and paid an undisclosed amount to settle claims against him. He then made a claim on this AIG policy which was denied, allegedly because Marsh failed to add the Groupama policy to the AIG policy.

    Galapatos sued and Marsh moved to dismiss. The motion was granted. Galapatos failed to state a claim for breach of contract because his complaint did not allege any specific provision of the purported agreement with Marsh that Marsh allegedly breached. Nowhere in the complaint did Galapatos refer to any term of the contract between him and Marsh, let alone one that specifically bound Marsh to procure insurance for Galani. 

    The complaint also alleged Marsh was negligent. The court noted that a claim for negligent failure to procure insurance required an allegation that defendant owed plaintiff a duty of care. Whether a defendant owed a duty of care was a question of law that, in cases of negligent failure to procure insurance, must be predicated on an affirmative request from the plaintiff. Here, Galapatos' negligence claim was deficient because he did not allege that Marsh was duty-bound to procure insurance in the manner he asserted. Galapatos asserted that he "expected" Marsh to "adequately" procure insurance for Galani. Brokers were under no duty, however, to procure a specific level of insurance coverage, adequate or otherwise, unless and until they were requested to do so. 

    Finally, Galagatos failed to state a claim for breach of fiduciary duty because he did not adequately allege a fiduciary relationship existed between him and Marsh.