Can an insurance company be held liable for negligently hiring an agent who allegedly used her position to bilk a vulnerable adult out of $104,000?
No, the Court of Appeals answered today in Johnson v. Peterson, et al. (The appellate court upheld dismissals of claims for negligent hiring, training, retention and supervision.)
The agent allegedly convinced the vulnerable man to give her the money to be used for medical emergencies faced by her and her family and because of her "dire financial situation."
In upholding the dismissal of the negligent hiring claim, the court found an employer cannot be liable on such a claim in the absence of evidence it was foreseeable an employee would pose a threat of physical injury at the time of hiring, or the employee inflicted a physical injury.
"The complaint only alleges emotional distress that may have caused heart problems and anxiety disorders," wrote Judge Christopher Dietzen. "But emotional distress is not a physical injury."
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