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Is legal advice for insurance claims reimbursable by insurer if initially deny the claim & later accepted the duty to defend?
Anonymous8 views6 answers
Business Policy claim for a civil litigation was denied with no duty to defend and told to hire own defense counsel at own expense. After countering, insurer accepted duty to defend but not duty to indemnify. Is all attorney fees reimbursable at retain counsel rate or insurer's lowball panel discount counsel rate which is almost 65% difference. Also is legal advice fees for insurance coverage and claims reimbursable by insurer at full rate because of initial denial of coverage? Please advise.
If there was a duty to defend initially and the insurer rejected thectender that's a breach of contract. You had to hire your own attorney and pay for it which are damages. I would definitely demand the insurer pay it. given the insurers quick change of mind your costs were probably low and it may not be cost effective to sue but you could.
So now they are paying to defend you, but won't pay to settle and/or won't pay a judgment. You might want to worry about that, huh? You can put in for reimbursement of your legal fees until the time they accepted, but that doesn't help you. Maybe you need to file for bankruptcy?
Michael Raymond DaymudeLitigation LawyerSherman Oaks, CA ·
Are *all* attorney fees reimbursable at retained counsel’s rate? Probably not. If there is a coverage dispute, and even if the carrier accepts defense, the carrier may still have a claim against you for reimbursement of *their* attorney fees if it turns out there was no duty to defend. So, I would not expect the carrier to roll over. Of course, this depends on a lot of factors. The attorney you retained would be the one to assist in obtaining any reimbursement. Good luck.
You should really check the language of their letter advising you they are defending you. The duty to defend is much broader than the duty to indemnify. If they have answered under a reservation of rights they might come after you at the conclusion of everything for attorney fees they are paying.
If they are answering under a reservation of rights then they do not have an obligation to pay your past bills but you also get to pick yoir own attorney. If not, then they should pay the bills but at a discounted rate and they pick the attorney.
Good luck. Any questions. Just ask.
Kevin
