Colorado Supreme Court Makes It Clear: Adjuster May not be Sued for Tort of Bad Faith

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The Supreme Court of Colorado was asked to answer a certified question of law from the United States District Court for the District of Colorado regarding the potential liability of insurance adjusters under sections 10-3-1115 to -1116, C.R.S. (2021) of Colorado’s statutes. Specifically, the certified question asks:

  "Whether an employee of an insurance company who adjusts an insured’s claim in the course of employment may for that reason be liable personally for statutory bad faith under Colorado Revised Statutes Sections 10-3-1115 and -1116 (“Statutes”)."

In Alexis Skillett v. Allstate Fire and Casualty Insurance Company, d/b/a Allstate Insurance Company and Collin Draine, 2022 CO 12, No. 21SA187, Supreme Court of Colorado, En Banc (March 14, 2022) the Colorado Supreme Court, decided that an action for unreasonably delayed or denied insurance benefits under Colorado law may be brought against an insurer, not against an individual adjuster acting solely as an employee of the insurer.


Insurers and insureds-not adjusters-are the parties to an insurance policy. They are the ones who undertake obligations under such policies, and it is the insurer-not the adjuster-who may be obligated to pay insurance benefits. 

The Supreme Court concluded that an action for unreasonably delayed or denied insurance benefits proceeds against an insurer, not an individual adjuster. The certified question was answered in the negative.


In the 1970’s lawyers in California, unhappy with the result of insurance bad faith cases in the federal courts, decided to sue adjusters and attorneys representing insurers as individual defendants to destroy jurisdiction in federal courts for lack of diversity. I was personally sued dozens of time where the plaintiffs alleged that when I sold them an insurance policy I promised them coverage. I am not now, nor have I ever been, an insurer or insurer’s sales person. I would file motions for summary judgment and win every time but would have to pay my lawyers and deductible and lost my insurance coverage. The same attempt was made in the state of Washington until it was stopped by the Washington Supreme Court.

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