Professional Negligence Law Reporter

A Wisconsin appellate court held that a firm that conducted a post-claim investigation of two insureds’ property damage was not exempt from liability for negligently performing the inspection.

Homeowners James Ropicky and Rebecca Leichtfuss made a claim for coverage under their Cincinnati Insurance Co. homeowners’ policy. Cincinnati Insurance hired Infratek Engineering Investigations, LLC, to investigate the couple’s property damage and determine the cause of the damage. Infratek conducted an investigation and issued a report to Cincinnati Insurance, which subsequently denied a large portion of the couple’s claim and filed a declaration that it owed no further coverage.

Ropicky and Leichtfuss filed a third-party lawsuit against Infratek, alleging negligence, negligent performance of an undertaking, and negligent supply of information. The defendant moved for summary judgment, arguing that as an agent of Cincinnati Insurance, it was exempt from liability under Wis. Stat. §895.475. This law exempts from civil liability those who furnish safety inspections or advisory services for an insurer where they are intended to reduce the likelihood of injury or loss. The trial court granted the motion.

Reversing, the appellate court found that the language of §895.475 is unambiguously forward-looking and does not provide immunity for an insurer’s own claim investigation seeking to limit its post-loss obligations under its policy. The statute refers to damages resulting from advisory services that seek to reduce future loss, the court added, noting that here, to the contrary, Infratek’s engineer was asked to investigate damage that had already occurred and there are no facts showing the investigation was intended to reduce the likelihood of loss to the plaintiffs.

The court noted that the defendant had not offered a single case from Wisconsin or elsewhere showing that a statute like §895.475 was applied to provide immunity for an insurer or its agent in the context of a post-loss claim evaluation or investigation under a property insurance policy. Citing case law and statutory language, the court concluded that the statute provides an exemption from civil liability when an insurer or its agent voluntarily inspects an insured’s property to ensure that it is safe and within the applicable code, not when an inspection occurs to adjust the insurer’s post-loss insurance claim.

Consequently, the court held that summary judgment had been improper.

Citation: Ropicky v. Infratek Eng’g Investigations, LLC, 959 N.W.2d 356 (Wis. Ct. App. 2021).

Plaintiff counsel: Scott R. Halloin, Milwaukee.