No Relief for Insured’s Lack of Diligence


Ph.D Who Failed to Read Policy Loses Suit for Coverage

Most people and their lawyers forget that the covenant of good faith and fair dealing is a two way street. The insured must deal fairly and in good faith to the insurer just as the insurer must deal fairly and in good faith with the insurer. That means the insured must be clear when ordering insurance and read the policy to determine that the policy ordered is the same one that was received.

In Amankwah v. Liberty Mut. Ins. Co., Court of Appeals of Ohio, First District, Slip Copy, 2016 -Ohio- 1321,  2016 WL 1244482 (March 30, 2016) John Amankwah appealed from the decision of the trial court granting summary judgment in favor of Liberty Mutual Insurance Company and insurance agent Robert Walker (the “Liberty Mutual defendants”) on Amankwah’s claims for negligent procurement and contract reformation, arising from an accident in which Amankwah’s vehicle was totaled and Amankwah had no collision coverage.


The relationship between Amankwah and the Liberty Mutual defendants began in 2006, when Amankwah purchased automobile insurance through Walker for a Mercury Sable. Amankwah obtained full, comprehensive coverage for the vehicle, which included collision coverage. At some point, Amankwah purchased a Kia and added this car to the policy as well, which also had full coverage. Amankwah testified that he reviewed the policy in 2006 and again when the Kia was added. Amankwah renewed the policy for the Sable and Kia in March 2011, and approximately one month later, Amankwah purchased a Volkswagen Passat to replace his Sable.

Amankwah called the number for Walker’s office to request an exchange of car insurance. According to Amankwah’s deposition testimony, he spoke with a woman at that office about “roll[ing] over” the policy from the Sable to the Passat. Amankwah recalled that the woman had told him that his total premium for the two vehicles would be increasing because the Passat was a “foreign-made” car, and that the woman would take care of his request. At that time, Amankwah asserts that Liberty Mutual began to automatically deduct his insurance premiums from his bank account on a monthly basis.

Amankwah testified that he “skimmed” through the April 2011 policy after he substituted the Passat, but he did not review the policy declarations page, which explained that Amankwah had no collision coverage on the Passat. The parties do not dispute that Amankwah received two more annual renewal policies, both of which also indicated the absence of collision coverage on the Passat.

In October 2013, Amankwah was involved in a car accident, and his Passat was a total loss, valued at $14,000 and his claim was rejected. Amankwah then filed suit against the Liberty Mutual defendants for negligence and contract reformation based upon mutual or unilateral mistake.

The Liberty Mutual defendants successfully moved for summary judgment on both claims, relying upon Amankwah’s deposition testimony, and an affidavit from a senior branch manager at Liberty Mutual.  Amankwah responded to the Liberty Mutual defendants’ summary-judgment motion with an affidavit addressing the contemporaneous note from his April 2011 call. In his affidavit, Amankwah avers that when he had called Walker’s office to switch vehicle coverage, he had discussed with the agency representative a transfer of the Passat’s warranty from the prior owner, and not the transfer of collision coverage.


The appellate court’s review of Ohio case law in actions brought by insureds against insurance agencies for negligence, where the insureds have indisputably breached their duty to review the policies, reveals that courts have reached differing results, not based upon any legal rule, but upon the unique facts of each case.

Several courts have relied on an insured’s failure to review coverage in an insurance policy in barring the insured from recovering from an insurance agency under a negligent-procurement theory.  The loss in this case goes beyond Amankwah’s failure to read the insurance policy according to the Ohio Court of Appeal.

According to Amankwah’s deposition testimony, he is highly educated with a Ph.D. in communications and holds a position as a professor at Mount Saint Joseph University. When he called the number to Walker’s office to “roll over” the insurance from his Sable to his Passat, Amankwah stated that the woman at the office had told him that his total premium would be increasing, because the Passat was a “foreign-made” vehicle. Although Amankwah expected his premiums to increase, he did not notice that his premiums actually decreased. Amankwah attempts to downplay his oversight because, at the time he obtained insurance on the Passat, Liberty Mutual began withdrawing the premiums on a monthly basis from his bank account. Thus, not only did Amankwah fail to read the policy declarations for two years, when a simple glance would have revealed the absence of collision coverage, but he also failed to examine his bank account and take notice that Liberty Mutual had decreased and not increased his premiums.

The change to Amankwah’s insurance policy was brought about by a condition he changed—selling the Sable and buying the Passat—not a periodic renewal of a policy with a condition changed by the insurance company. Amankwah knew his policy would change by virtue of insuring a newer, foreign-made vehicle, causing his premium to increase. Reasonable minds can conclude only that Amankwah’s loss of his vehicle was proximately caused by his negligence, and not the negligence of the insurance agent or Liberty Mutual.


An insurance policy may be “reformed” to correct a mutual mistake by the insured and the insurer, or to correct a unilateral mistake made by the insurer in failing to issue a policy in accordance with a prior agreement of the parties. Reformation is an equitable remedy that requires the court to treat the parties with fairness, available to a complaining party who has acted with reasonable diligence. Where a complaining party has failed to read a contract, equitable relief in the form of contract reformation is appropriately prohibited.

As a matter of law Amankwah cannot claim relief on the grounds of mistake when the loss occasioned by the alleged mistake was the result of his own negligence.


Insurance contracts are mutual agreements between the insured and the insurer and are reduced to writing. For a person with a Ph.D in communications to claim he is entitled to relief because he did not read the policy, note that he was charged less for the addition of the Passat rather than the more promised, simply sat on his rights and was neither entitled to a contract interpretation that the policy should be changed to provide collision coverage that was neither ordered nor paid for.

ZALMA-INS-CONSULT                      © 2016 – Barry Zalma

Barry Zalma, Esq., CFE, practiced law in California for more than 43 years as an insurance coverage and claims handling lawyer.  He now limits his practice to service as an insurance consultant and expert witness specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes.

He founded Zalma Insurance Consultants in 2001 and serves as its only consultant.

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About Barry Zalma

An insurance coverage and claims handling author, consultant and expert witness with more than 48 years of practical and court room experience.
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