NJ Supreme Court: Consumer Fraud Act Exceptions Exempt Insurance Pros

On July 15, 2026, the New Jersey Supreme Court held that insurance brokers, producers, and agents are not “learned professionals,” and therefore are not exempt from liability under the Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 et seq. In so holding, the Court eradicated the previously recognized, judicially created “semi-professional” exception and further clarified the definition of “learned professionals.”

In Lowe v. Audet, plaintiff, a neurosurgeon and co-owner of a medical practice, brought claims against defendant insurance brokers who marketed, sold, produced, and procured insurance policies for plaintiff and his medical practice, including disability-related coverage. Plaintiff alleges that although defendants advised him that he would receive maximum benefits under his policies if he became disabled, defendants failed to obtain sufficient disability insurance which would fully cover plaintiff when he later became physically disabled and unable to perform neurosurgery.

Plaintiff filed a complaint against defendants alleging, among other claims, violation of the CFA for negligently failing to obtain sufficient disability insurance coverage. The trial court dismissed Plaintiff’s CFA count for failure to state a claim, concluding that insurance brokers, producers, and agents are exempt from the CFA under the learned professional exception as “semi-professionals.” The Appellate Division affirmed, and the Supreme Court granted certification to address the issue of whether insurance professionals are exempt from liability under the CFA pursuant to the learned professional exception, either as “semi-professionals” or otherwise.

The Supreme Court ultimately reversed, holding that insurance professionals are not exempt from the CFA. After detailing the extensive and contradictory history of New Jersey court holdings pertaining to the learned professional exception, the Court rejected defendants’ reliance on Plemmons v. Blue Chip Insurance Services, Inc., 387 N.J. Super. 551 (App. Div. 2006), which had characterized insurance brokers as “semi-professionals” and accordingly excluded insurance brokers from CFA liability for services rendered within the scope of their licenses. The Court found no support in the text of the CFA for a separate “semi-professional” exception.

Relying on the definition of “learned professional” set forth by the Appellate Division in Shaw v. Shand, 460 N.J. Super. 592 (App. Div. 2019), the Court held insurance brokers do not fall within the narrow class of professionals historically recognized as “learned,” such as physicians, attorneys, and theologians. The Court further noted that licensing and regulation alone do not justify exemption from the CFA, particularly where there is no direct and unavoidable conflict between the CFA and the regulatory scheme governing insurance brokers. The Court emphasized that insurance brokers’ educational requirements are comparatively limited and that extending the learned professional exception to them would improperly narrow the CFA’s broad remedial purpose. The Court reasoned that allowing insurance professionals to avoid CFA liability merely because they are licensed and regulated would undermine the statute’s consumer-protection objectives.

 The decision confirms that insurance brokers, producers, and agents may be subject to CFA liability and cannot avoid such claims by invoking a “semi-professional” or learned professional exception. While the Court rejected the “semi-professional” exception altogether, it did not definitively assess or reaffirm the broader learned professional exception itself. However, the Court expressed doubts about the learned professional exception’s continuing viability and invited the New Jersey Legislature to clarify the issue.

Insurance professionals should pay careful attention to their sales practices and ensure that all coverage issues are accurately communicated to their clients now that the Supreme Court has made it clear that they can be subject to additional liability when disputes arise.