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Schweitzer v. American Family Mutual Insurance Co.

Court of Appeals of Indiana

August 26, 2014

DARYL SCHWEITZER and LYNN SCHWEITZER, Appellants-Plaintiffs,
v.
AMERICAN FAMILY MUTUAL INSURANCE COMPANY and JENNIFER GHOLSON INSURANCE AGENCY, Appellees-Defendants

APPEAL FROM THE LAKE SUPERIOR COURT. The Honorable Gerald N. Svetanoff, Judge. Cause No. 45D04-1010-CT-242.

Page 983

ATTORNEY FOR APPELLANTS: DONALD E. WERTHEIMER, South Bend, Indiana.

ATTORNEY FOR APPELLEES: J. THOMAS VETNE, JANET G. HORVATH, Jones Obenchain, LLP, South Bend, Indiana; ROBERT S. O'DELL, O'Dell & Associates, P.C., Carmel, Indiana.

BROWN, Judge. VAIDIK, C.J., and NAJAM, J., concur.

Page 984

OPINION

BROWN, Judge

Daryl and Lynn Schweitzer appeal the trial court's order granting summary judgment in favor of American Family Mutual Insurance Company (" American Family" ) and Jennifer Gholson Insurance Agency (" Gholson," and together with American Family, " Appellees" ). The Schweitzers raise two issues, which we revise and restate as whether the court erred in entering summary judgment in favor of Appellees and against the Schweitzers. We affirm.

FACTS AND PROCEDURAL HISTORY

At some point prior to January 2008, the Schweitzers became interested in insuring their home, automobiles, and rental properties using one insurance company. Following conversations with Gholson, the Schweitzers purchased a homeowners insurance policy from American Family. The policy provided that it was effective from January 18, 2008, to January 18, 2009, and that the amount of the coverage limit for the dwelling was $261,000.[1] The policy also included coverage for personal property and personal liability, and supplemental coverage of increased building limit coverage, whereby American Family agreed to settle losses to the dwelling at replacement cost up to a maximum of 120 percent of the dwelling limit, and inflation protection coverage with respect to the dwelling and personal property, each as subject to the policy's provisions.

On December 19, 2008, a fire destroyed the Schweitzers' house. The Schweitzers reported the loss to Gholson, and a representative for American Family visited the location of the house and discussed with the Schweitzers the coverage limits of their policy. The Schweitzers submitted various claims, and American Family made several payments to them totaling $326,040, which American Family indicated was the limit of its policy for the dwelling.[2] American Family informed the Schweitzers that it would not be affording coverage for any damage to the driveway. American Family also received a claim on September 20, 2010, alleging that a theft of certain property occurred on January 28, 2009, and American Family initiated an

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investigation and requested statements from the Schweitzers, but Daryl informed American Family that his wife Lynn would not provide a statement.

On October 18, 2010, the Schweitzers filed a complaint against American Family and Gholson. As to American Family, they alleged that not all of the benefits due under the policy were paid and that the remaining benefits due included amounts for losses to or in connection with the structure, landscaping, pond, driveway, well and septic system, relocation, additional living expenses, and contents in the house beyond the policy limits improperly applied by American Family. The Schweitzers further claimed American Family unreasonably delayed certain payments and that they should be considered beneficiaries of a practice instituted by American Family requiring its agents to write policies for full replacement coverage. The Schweitzers also alleged that the total limit of structure coverage improperly utilized by American Family was $326,040, that the actual loss they sustained substantially exceeded that limit, and that American Family acted in bad faith, for which they requested punitive damages. As to Gholson, the Schweitzers asserted they totally relied upon the professional services and advice of Gholson and believed they had full and complete insurance coverage in the event of a total loss of their residence. The Schweitzers alleged Gholson was negligent in part for failing to follow a directive of American Family to issue full replacement cost policies to its insureds, failing to cause a policy to be issued with sufficient amounts of coverages to fully indemnify them against loss, and failing to make an adequate determination of the proper amount of coverages.

On August 6, 2012, Gholson filed a motion for summary judgment together with designated evidence and a brief in support of the motion. The same day, American Family filed a motion for summary judgment together with designated evidence, a brief in support of the motion, and a statement of undisputed facts. The Schweitzers filed designations of evidence and memoranda in opposition to the summary judgment motions. The court held a hearing on the motions on December 4, 2012.

On March 28, 2013, the court entered an order granting summary judgment in favor of Appellees and against the Schweitzers. The court found that, as a result of a meeting between the Schweitzers and Gholson, American Family issued a policy to the Schweitzers and that Daryl reviewed the amount of the coverage provided under the policy and did not disagree with the coverage limits or ever ask Gholson to increase the amount of the coverage. The court also found that, following the loss of the house, American Family requested Lynn to provide a recorded statement pursuant to the terms of its policy and that Lynn never provided the statement. The court cited Filip v. Block, 879 N.E.2d 1076, 1079 (Ind. 2008), reh'g denied, and Myers v. Yoder, 921 N.E.2d 880 (Ind.Ct.App. 2010), and found that Gholson did not owe the Schweitzers the duty to tell them about the adequacy of their coverage or any alternative coverage that may be available and accordingly that the Schweitzers' claim against Gholson for negligent procurement of insurance must fail. The court further found that the designated evidence established that American Family made payment of all amounts due under the applicable coverage categories in the policy, and that American Family designated evidence, not rebutted by the Schweitzers, establishing that the Schweitzers' claim with respect to the alleged damage to their driveway was excluded from coverage. Finally, the court found that the Schweitzers breached the policy as a matter of law because Lynn never

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provided a recorded statement to American Family under the ...


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