Perspective
Jun. 27, 2012
Insurer’s delay leads to loss of right to control the defense of its insured
A court ruled that insurers who delay for as little as "several months" can lose their right to control the defense. By Terry C. Leuin and Kurt W. Melchior of Nossaman LLP
Insurers have the right under most insurance policies to control the defense of a lawsuit against their insured. In doing so, they generally retain "panel counsel" who have strong loyalties to the insurer and who have arranged highly discounted fees with the insurers who appoint them. But another aspect of insurance law requires that the insurer provide the required defense "promptly" or "immediately...
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