Almost all homeowners and businesses purchase insurance policies to provide financial protection from direct damage to businesses and residences resulting from an unanticipated loss.  Because many policyholders focus on coverage for property damage, there is a tendency to pay less attention to the importance of the liability portion of a policy.  Liability coverage under a homeowners’ policy or commercial general liability (CGL) policy yield protection from damages pursued in third party lawsuits.  This blog post provides important information for policyholders about an insurance carrier’s duty to tender a defense and indemnify insured parties against such liability claims.

Does the Claim Fall Under the Policy?

When analyzing whether a claim falls under the liability coverage of a policy, an insured’s inquiry should begin with whether a “suit” exists.  This term refers to a proceeding in a civil lawsuit commenced by filing a summons and complaint.  However, the language used to define “suit” is fairly broad under most policies, so the term generally encompasses alternate dispute resolution (ADR) proceedings like mediation or arbitration.  Depending on the specific facts and circumstances, the term might even be broad enough to include certain types of proceedings brought by government agencies.

The next hurdle is to establish that the “suit” requesting damages was caused by an “occurrence,” which generally is defined as an “accident.”   The term “accident" typically includes ongoing or repeated exposure to the same harm.  Accidents in this context refer to unanticipated events, so intentional acts of the insured are expressly excluded.  In other words, the claim generally will not be covered if the insured intentionally causes injury, or the harm suffered was the anticipated and natural result of the policyholder’s actions.

Another important issue is whether the “suit” seeks categories of damages covered under the policy.  While liability coverage under CGLs and homeowners’ policies extend to personal injury and property damage, there are many nuances and exclusions that might apply, so careful review of the policy is important.

You can reach Miami Insurance Claims Lawyer J.P. Gonzalez-Sirgo by dialing his direct number at (786) 272-5841, calling the main office at (305) 461-1095, or Toll Free at 1 (866) 71-CLAIM or email Attorney Gonzalez-Sirgo directly at [email protected].

J.P. Gonzalez-Sirgo
J.P. Gonzalez-Sirgo, P.A.
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