Prosperity Guardian | Property damage

Will Your Insurance Company Defend You in Court?

On July 5, 2012 By Bradley Hamburger

Commercial general liability insurance pays for lawsuit settlements or court judgments that an organization would otherwise have to pay for certain types of harm others suffer. These include bodily injuries, property damage, advertising injuries, and personal injuries such as violations of privacy. Another benefit of this insurance, however, can be just as valuable or even more so: coverage for the cost of legal defense.

The standard CGL insurance policy gives the insurance company “the right and duty to defend the insured” against any suit seeking damages. Conversely, the company has no duty to defend the insured against a suit seeking damages for an incident the policy does not cover. The company’s duty to defend ends when it has paid out the policy’s maximum limit of insurance for settlements or judgments. Most policies provide coverage for defense costs in addition to the amounts available for payment of damages.

Because the company [...]

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