The Urban Legend of An Insurer’s Duty to Provide The “Best Defense Possible” for An Insured

When I was in-house several years ago, I met with a lawyer and the regional claims manger to go over the reductions taken in the lawyer’s legal bills.  Most of the reductions were for an “over the top” defense we did not think was reasonable.

As we went over each deduction, I patiently told him the reason for each reduction.  Nevertheless, the lawyer was clearly becoming exasperated.  Finally, he asked, “doesn’t your company believe in providing your insureds with the ‘best defense possible’?!”

I would like to have replied, “No.  And if we did, we wouldn’t have hired you!”  But, I held my tongue and didn’t do so.  What I did do was to patiently explain to the lawyer that no insurer has an obligation to provide an insured with the “best defense possible” (manuscripted policies notwithstanding). Continue reading