Strategies, Challenges, and Answers

The Duty To Defend Is Broader Than The Duty To Indemnify

The duty to defend is broader than the duty to indemnify because the duty to defend covers not just claims for which the insured is liable, but also claims for which the insured could be found liable. United Nat’l Ins. Co. v. Frontier Ins. Co., 120 Nev. 678, 687, 99 P.3d 1153, 1158 (2004). Where there is no potential for coverage, there is no duty to defend. Bidart v. Am. Title Ins. Co., 103 Nev. 175, 179, 734 P.2d 732, 734 (1987). When interpreting insurance policy terms, the Nevada Supreme … [Read more...]

Settlement, Unsettled

The claimant’s counsel makes a policy limit demand. After receiving authority to settle for the liability limits, you tender the policy limit and your company’s standard Release.  Claimant’s counsel rejects the Release.  Instead, counsel insists on a Covenant Not to Execute.  Why would the attorney do that? This post will hopefully give you more information regarding the distinctions between these two types of settlement documents and the advantages and disadvantages of each. What is the … [Read more...]

What Type of Proceedings Must a Nevada Insurer Defend?

Most liability policies obligate the insurance company to defend its insured in case of a “suit”.  So what proceedings constitute a “suit” that an insurer must defend?  Assuming a duty to indemnify for damages based on a theory of liability put forth in the Complaint, the insurance company has a duty to defend such a lawsuit.  State Farm Mut. Auto. Ins. Co. v. Hansen, 131 Nev. Adv. Op. 74, 357 P.3d 338 (2015).  However, the Nevada Supreme Court has not faced a decision as to whether that duty … [Read more...]

What Triggers An Insurer’s Duty To Defend In Nevada?

A primary insurer's right and duty to defend attaches upon notice of a demand and continues through the litigation to final resolution of the claim.  Allstate Ins. Co. v. Miller, 125 Nev. 300, 309, 212 P.3d 318, 325 (2009). An insurer’s “duty to defend is broader than the duty to indemnify. In other words, as a general rule, an insurer's duty to defend is triggered whenever the potential for indemnification arises, and it continues until this potential for indemnification ceases." Benchmark … [Read more...]

A Tale of Two Lawsuits.

It was the best of times for Nevada Direct Insurance Company. It was the worst of times for injured parties Michael and Sharon Smith. You see, the Smiths were hurt in an auto accident with a Nevada Direct policyholder Kuperman. Nevada Direct tried unsuccessfully to enlist Kuperman's cooperation in dealing with the Smiths’ claim. When Kuperman failed to cooperate, Nevada Direct filed a declaratory relief action against Kuperman, the Smiths and another injured party, Ms. Fields claiming the … [Read more...]