Commercial General Liability Policies and the Duty to Defend
Experienced Insurance Litigation Lawyer in Miami, FL Many Commercial General Liability (CGL) policyholders assume that their insurer will necessarily jump to their defense and provide the services that are required under their CGL policy. The reality can be sobering. Insurers will do everything they can to avoid additional losses, and this includes aggressive attempts to avoid having to engage their duty to defend the policyholder against third-party claims. If the insurer is successful, this can put the policyholder in an unenviable position, forcing them to pay out-of-pocket for their own defense in the ensuing lawsuit. CGL policies typically include a duty-to-defend provision that compels the insurer to step in and handle your defense in the event of third-party litigation. But how do these obligations work, exactly? Understanding the Duty to Defend CGL insurers (where the policy includes a duty-to-defend) are obligated to handle their policyholder’s defense, and in some cases, to indemnify the policyholder if the case leads to damages. In many cases, however, insurers fail these obligations: The insurer may argue that the claims at-issue are not entitled to coverage under the policy, and may refrain from providing a defense on that basis; or The insurer may handle your defense but may not perform their obligations reasonably under the circumstances. With respect to (a), it’s worth noting that an insurer’s obligation to defend is based on the allegations in a lawsuit. The insurer must provide a defense in the lawsuit even if there is only one allegation that is […]