Ostensible agency liability

{
  "id": "MLC-T-INS-002441",
  "term": "Ostensible agency liability",
  "field": "Insurance and risk management",
  "definition": "Legal responsibility imposed on a principal for the actions of an agent, even if the agent lacked actual authority, because the principal's conduct led a third party to reasonably believe the agent had such authority. In insurance, this can arise if an insurer allows an agent to appear as if they have the power to bind coverage or settle claims, leading policyholders to rely on the agent's representations. The insurer may be held liable for the agent's unauthorized acts.",
  "url": "https://mlchart.com/terminology/insurance/ostensible-agency-liability/"
}