Insurance Coverage Denial and Reservation-of-Rights Guide
An insurance denial or reservation-of-rights letter can affect the defense and financial exposure associated with a lawsuit or loss. The first step is to preserve the complete policy and underlying documents.
Documents to Gather
- All policies, declarations, endorsements and renewal records for potentially relevant periods
- Coverage denial and reservation-of-rights letters
- Claim submissions, adjuster correspondence and notices
- The complaint, demand letter, accident report or loss documentation
- Records identifying the date of the incident and date notice was sent
Duty to Defend Versus Indemnify
The duty to defend concerns providing or paying for a defense to certain claims. The duty to indemnify concerns payment of covered liability or loss. They are distinct questions, and their scope depends on the policy and governing law.
What Is a Reservation of Rights?
It commonly means the insurer has identified potential coverage issues while addressing the claim or defense. Read the specific policy provisions and stated reservations carefully.
What If Coverage Was Denied?
Evaluate the insurer’s stated reasons, exclusions, factual assumptions, notice provisions and any available review or dispute procedure. Do not miss deadlines while discussing the matter informally.
Who Does the Attorney Represent?
Insurance defense and insurance coverage disputes can present different representation and conflict questions. The role of counsel and the parties’ interests must be clarified.
Review our insurance law practice and business litigation defense.
Need advice on a specific matter? Contact Muggeo & Associates or call (978) 741-1177.
This resource is general information, not legal advice. Laws, coverage, notice requirements and deadlines depend on the jurisdiction and facts. Do not delay seeking individual advice. Contacting the firm does not create an attorney-client relationship. Prior results do not guarantee future outcomes.