Overview of Insurance Defense Law

Insurance defense law involves representing insurance companies and policyholders in civil litigation claims. When someone files a legal claim against the policyholder for personal injury or property damage, attorneys representing the insurance companies come to the defense of policyholders. The insurer’s “duty to defend” covered claims is part of the insurance policy.

Generally, insurance defense lawyers protect the insurance company’s interests by reducing the risk or cost of liability. Insurance defense lawyers handle claim investigation, settlement negotiations, litigation, and court trials. Insurance defense can also involve court appeals. Insurance defense laws can vary by state. For more information, talk to a local insurance defense lawyer.

What Is Insurance Defense Law?

Insurance defense law involves representing insurance companies and defending them against legal claims. This practice area generally varies by the type of claim, such as medical malpractice, auto accidents, or workers’ compensation.

When someone makes a claim against the policyholder for covered claims, the insurance defense lawyer defends the policyholder on behalf of the insurance company. Insurance defense teams will try to avoid liability, reduce liability, or negotiate for a lower settlement payment. Generally, insurance defense involves trying to pay out as little as possible when someone makes a claim against the insurance policy.

The insurance company will only represent you to the extent of your policy coverage. For example, if you have a $10,000 policy for personal injury claims on your property and someone files a premises liability lawsuit for $50,000, you may still have personal liability for the remaining $40,000 in compensation.

Insurance defense litigation can get very complicated when it involves multiple insurance companies. In multi-party litigation, different parties may have different levels of fault, contributory negligence, and liability coverage. Different insurers can negotiate indemnification or liability shifting to lower their liability risk.

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The Role of an Insurance Defense Attorney

An insurance defense attorney represents both the insurer and the policyholder. The extent to which the insurance defense lawyer handles any claims depends on the insurance policy language. This includes the insurance company’s decision-making power in claim settlements.

Policyholders pay insurance premiums to the insurance company for liability coverage. When someone makes a claim on the insurance policy, the insurance company investigates the claim.

A first-party insurance claim involves the policyholder filing a claim under their own policy. A third-party insurance claim involves someone else filing a claim against the policyholder. In either case, the insurance adjuster will review the claim and determine if the insurance company must pay out under the policy.

Insurance defense most commonly comes into play when there are lawsuits against the policyholder. For example, doctors have medical malpractice insurance to protect against malpractice lawsuits. If a patient files a medical malpractice claim against the doctor, the doctor will notify their insurance company.

The insurance company will assign a defense attorney to represent, defend, and give legal advice to the doctor. The insurance company will pay the legal costs of defending the lawsuit. The insurance defense attorney will handle litigation and any settlement negotiations. When the lawsuit settles or the court awards compensation, the insurance company will pay any damages, up to the policy limits.

Types of Cases Involving Insurance Defense

The most common scenario where people come across insurance defense involves car accidents. Most motorists have an auto insurance policy that covers them for accidents involving property damage or personal injury claims. If they get into an accident, the defense attorney will represent the policyholder on behalf of the insurance carrier.

However, insurance defense can involve any type of insurance policy or liability claim. Common types of insurance defense cases include:

• Car accidents
• Medical malpractice
• Legal malpractice
• Professional liability
• Premises liability
• Product liability claims
• Workers’ compensation claims
• Homeowner insurance claims

Insurance defense can also involve cases of possible insurance fraud. Insurance fraud could involve misrepresentations to the insurance company, bad faith claims, or false claims.

What To Do if Your Insurance Claim is Denied

Insurance companies deny claims for various reasons. The adjuster may not think policy covers the type of claim. The claim may also fall outside of the coverage period. When the insurance company denies a claim, they save money by not paying out the claim. However, some liability insurance adjusters may deny a valid claim by mistake or intentionally in bad faith.

Policyholders generally have a chance to appeal a denial. The appeal process can depend on the terms of your insurance policy and state law. You may need to submit additional evidence or information to support your claim. If the insurance company continues to deny your claim, you can file a lawsuit against the insurance provider. An insurance attorney can help with an insurance claim lawsuit for denied coverage.

Legal Advice From an Insurance Defense Lawyer

If you are a policyholder, your insurance company will generally handle the insurance defense claims. However, they only represent you as a policyholder, not as an individual. The insurance defense team represents the insurance company. If you have a coverage dispute with your insurance company, you can contact a separate attorney. Find an attorney with experience in the relevant practice area for legal advice.

Many insurance companies have an in-house legal team to handle defense claims. Insurance companies also work with independent attorneys to handle litigation and settlement negotiations. Independent attorneys have the insurance company as their client to provide legal services. They work closely with the insurance company representatives before making settlement agreements.

For legal advice about how attorneys represent policyholders and the insurance company, contact a local insurance defense lawyer.