Civil Code section 2860 authorizes the retention of independent counsel in the event a conflict of interest arises between the insurer and its insured. Under the statute a conflict of interest is deemed to arise “when an insurer reserves it rights on a given issue and the outcome of that coverage issue can be controlled by counsel first retained by the insurer for the defense of the claim”. Section 2860(b).

But what happens if, in the absence of insurer appointed counsel, the insured selects counsel to defend the claim, with the insurer’s acquiescence? In that circumstance, is the ...

Where multiple liability policies are triggered, does one of the insurers get to insist that its deductible be satisfied before the insured can be provided with a defense? Relatedly, can the insured choose which insurer should provide the defense?  

This situation arises frequently in cases where the underlying damage is “continuous or progressive.” Montrose Chemical Co. v. Admiral Ins. Co., 10 Cal. 4th 645, 662 (1995). In Montrose, the California Supreme Court held where there are successive policies, and where there is damage that is continuous or progressive across multiple ...

Liability insurance written on a claims made basis is designed to protect an insured against claims asserted following the policy’s inception even if the acts giving rise to the claim took place prior to policy inception. But if prior to policy inception the insured was aware of facts or circumstances that could have reasonably led the insured to believe a subsequent claim would be asserted during the policy period, then coverage might be challenged.

Liability carriers have sought to address this by including “prior knowledge” exclusions in their policies. Under those ...