What Is Failure to Defend?

what is failure to defend

Insurance companies owe their policyholders a duty of good faith and fair dealing. The failure to do so could be considered insurance bad faith. Insurance bad faith claims can include things like delay or underpayment of claim or the failure to defend.

Reno bad faith insurance attorney Matthew L. Sharp helps clients pursue insurance bad faith complaints, such as failure to defend and delay or underpayment of claim. Over the past 30 years, he has dedicated his practicing to fighting bad faith insurance companies and obtaining favorable outcomes for individuals and businesses who have been the victim of unlawful conduct.

If you suspect that you are being mistreated by your insurance company, contact Matthew Sharp to learn more about a possible insurance bad faith complaint.

Failure to Defend

If you are in an accident or somehow cause harm to someone else, the injured party may bring a cause of action against you and/or your insurance company. Many insurance policies – whether auto insurance, homeowner’s insurance, or business insurance – say that the insurance company must defend the policyholder in any legal claims and indemnify the policyholder for the third-party claims covered by the insurance policy.

The specific terms of the duty to defend depend on the language included in the insurance policy, as well as the third-party complaint filed against the insured. Generally, if the third-party complaint alleges facts that bring the cause of action within the scope of the policy coverage, the insurance company is obligated to defend its policyholder. If, on the other hand, the lawsuit alleges facts that would place the cause of action outside the scope of policy coverage, the insurance company is likely not required to defend the policyholder.

Whether or not an insurance company is obligated to defend a policyholder is a tricky legal issue that depends on a number of specific factual and legal considerations. For this reason, it is highly recommended that you consult with an insurance claim attorney if you have been sued for an accident that may be covered by an insurance policy.

Damages for Failure to Defend

If an insurance company is found liable for the failure to defend, the policyholder could be awarded damages for the following:

  • Attorney fees and other costs incurred in connection with the legal action
  • Any judgment or settlement amount (up to the policy limits) that it is ordered to pay in the third-party lawsuit
  • Interest accrued on the judgment in the third-party action
  • Attorney fees and other costs incurred by the insured in bringing a bad faith insurance claim for the failure to defend
  • Emotional distress caused by the insurance company’s failure to defend

Find an Insurance Bad Faith Attorney

For more than 30 years, Reno insurance lawyer Matthew Sharp has focused on handling bad faith claims, including the failure to defend. He has the experience and know-how that you need to handle the complex contractual and tort legal issues involved in insurance disputes, and he represents clients in insurance disputes involving all types of insurance policies, including:

If your insurance company has failed to provide a timely defense to a third-party legal action, contact Reno insurance bad faith lawyer Matthew L. Sharp to schedule a free consultation to learn more about your legal options.