A Connecticut federal judge has ruled that claims of negligence, professional malpractice, and breach of contract may proceed against an Allstate insurance agent who allegedly failed to timely renew a long-standing flood insurance policy, causing a lapse in coverage. The court dismissed related claims alleging breach of fiduciary duty, unfair insurance practices, and bad faith.
The case, Gerald J. Candeloro v. Allstate Insurance Co., et al., involves a dispute between Gerald J. Candeloro and Jason Garoppolo, an Allstate agent and owner of the insurer’s Groton, Connecticut franchise. Candeloro, who owns property in Mystic, Connecticut, had consistently purchased a FEMA flood insurance policy for the property through Allstate since 2000. His most recent policy, obtained through Garoppolo on September 14, 2021, expired on September 29, 2022.
Candeloro alleged that from August 9 through October 7, 2022, he made repeated requests to Garoppolo to renew the policy. On October 7, Candeloro learned from his mortgage company that it had not received a certificate of renewal. Although the policy was still within its grace period, it was not renewed in time and ultimately expired. The mortgage company then purchased temporary coverage and charged Candeloro for the cost. He also alleged other monetary damages stemming from the lapse.
Candeloro filed a complaint in Connecticut state court, asserting six counts against Garoppolo: negligence, professional malpractice, breach of contract, breach of fiduciary duty, violations of the Connecticut Unfair Trade Practices Act (CUTPA) and the Connecticut Unfair Insurance Practices Act (CUIPA), and bad faith. The case was later removed to federal court. Garoppolo moved to dismiss all claims except breach of contract.
In his defense, Garoppolo argued that the claims were preempted by federal law under the National Flood Insurance Act (NFIA) and FEMA’s Standard Flood Insurance Policy (SFIP). FEMA regulations provide that disputes regarding “policy issuance, policy administration, or the handling of any claim” are exclusively governed by federal law.
U.S. District Judge Kari A. Dooley rejected the preemption defense. Citing both FEMA’s official guidance and persuasive authority from the Fifth Circuit’s decision in Campo v. Allstate Ins. Co., the court found that claims against an insurance agent arising out of the procurement or renewal of coverage—including negligence or failure to act within a grace period—are not preempted. FEMA’s own bulletin states that agent-related procurement disputes are distinct from those involving a Write-Your-Own (WYO) insurer and are therefore not subject to the federal preemption clause. As a result, the court denied the motion to dismiss on preemption grounds for all counts.
However, the court ultimately dismissed three of the six claims on other legal grounds.
First, the claim for breach of fiduciary duty was dismissed. The court explained that under Connecticut law, a fiduciary duty does not arise from a typical commercial relationship between an insurance agent and a client. The plaintiff’s complaint did not plausibly allege any relationship marked by exceptional trust, dependency, or vulnerability that would justify imposing fiduciary duties.
Second, the court dismissed the CUTPA/CUIPA count. The complaint included broad allegations of misrepresentation and unfair conduct but failed to specify which CUIPA provisions had allegedly been violated. In opposing the motion, Candeloro referenced Conn. Gen. Stat. § 38a-323, which governs notice requirements for nonrenewals—but the court noted that this statute was not cited in the complaint and rejected the attempt to raise it in briefing as an improper post hoc amendment.
Finally, the bad faith claim was also dismissed. The court found that the claim failed to distinguish between Garoppolo and Allstate and lacked factual allegations that would support an inference of deceptive intent, ill will, or dishonest purpose. While professional negligence was plausibly alleged, bad faith under Connecticut law requires more than incompetence—it requires evidence of a deliberate intent to mislead or deceive. The court emphasized that Garoppolo is not the insurer, and no legal authority was cited supporting a bad faith tort claim against an agent under these circumstances.
As a result, Candeloro’s claims for negligence, professional malpractice, and breach of contract remain pending. The court’s decision reinforces the legal distinction between insurance agents and WYO insurers under the NFIA and confirms that state-law claims based on agent error in procuring or renewing coverage can proceed, even in the context of federally regulated flood insurance.
The case continues in the United States District Court for the District of Connecticut.
Case: Gerald J. Candeloro v. Allstate Insurance Co., et al.
Case No.: 3:23-cv-00585 (KAD)
Court: U.S. District Court for the District of Connecticut
Judge: Kari A. Dooley
Decision Date: March 26, 2025
