What is the “duty to defend”?

September 8, 2008 by Zale.

Under a liability policy of insurance, whether it be a policy for an automobile, business or anything else, the insurance company has two duties.

• The duty to indemnify the policyholder for the loss and
• The duty to defend the policyholder.

Most people just think about the duty to indemnify.  This means that if the policyholder gets sued, and the plaintiff wins $500, then the policy pays $500.

Contrast this to the duty to defend.  The duty to defend has to do with whether or not the insurance company is going to hire one of their attorneys to defend the policyholder at all.  This phase is well before finding out whether or not the claim is worth the above $500.

The duty to defend the policyholder is broader than the duty to indemnify the policyholder.  So, if the insurance company says that part of the lawsuit is excluded under a policy provision, this means that they still pay an attorney to defend you.   If the insurance company does not defend or indemnify the policyholder, then they are just completely leaving the policyholder out in the cold.

So, if you find yourself in a position where the insurance company is denying you a defense, that’s a big deal.  Have an attorney look at that denial for you.  Being an attorney who has actually dealt with coverage denials, feel free to give my office a call.

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