Will My Insurer Defend My Company in Court?
If your business insurance includes liability cover, then yes. Your insurance provider will provide cover if a third party makes claims against your business in court. If your business has no liability cover, your insurer does not need to defend you in court. Your personal or domestic policy will not cover business related claims by third-parties.
Are All Claims Included?
No. Most liability policies only cover specified events. You can find the list of the types of claims they will and won’t cover in your insurance policy documents. You can also speak to your broker for clarity if you still aren’t sure. If the claim is not covered under your business liability insurance policy, the insurer is not obligated to defend you by hiring a representative for you (usually from a pre-approved list of attorneys).
How Does My Insurer Defend My Company in Court?
For policyholders with liability cover, your insurer will hire a lawyer to represent you, and they will pay his fees. Often, the insurer will want to approve the legal expenses before paying them. If you go to court, your cover works like this:
If the Court Rejects Your Defence?
Your insurer doesn’t have to pay out for any claim that isn’t covered according to your policy.
If You Plan to Counter Suit?
Your insurer does not need to offer cover if you plan to file a counter suit.
If the Court Finds You Liable for Damages?
As long as the case is about an even covered by your insurance provider, they will pay out in this case.
Often, insurance companies try to settle the matter before it goes to court. They may investigate the claims and offer settlement where possible. You can find the details of what your cover will look like in your insurance policy. Don’t have liability cover? Just fill in our form and a representative will contact you!
Insurance Expert is a professional when it comes to long-term, short-term and medical cover in South Africa. He has the collective knowledge of an insurance litigator and actuary with as many years in the South African insurance industry as Lloyd has in London. Have an insurance conundrum? Ask our Insurance Expert and he’ll source the answer from one of the specialists in our panel.
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