Thursday, August 12, 2004

Insurer settles with plaintiff to keep from paying insured's defense

via FindLaw:

"presents a novel but potentially quite important issue of insurance law:
whether a liability insurer, asked to defend (or pay the defense costs in) a
suit against its insured that contains some claims that are covered by the
insurance policy and others that are not, can limit its responsibility to defend
by paying the plaintiff in the liability suit to replead the covered claims as
uncovered claims."

Sounds messy at first, but there's no telling whether the net effect would be negative for the insured. Would the plaintiff still sue if there was no coverage?

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