Reception of the summons and complaint when a suit is filed can be unsettling. Many times, a policyholder will call their insurance company or agent in a panic, wondering what to do. But warn the company or agent is exactly what you need to do :. Allow your company or agent know that you received the summons and complaint so they can respond appropriately
It is essential to the summons and of the complaint is forwarded to your insurance company immediately. The courts only allow a certain amount of time for a response to be filed. If you fail to notify your company of the combination, a default judgment may be made giving the party filing the complaint exactly what they asked. There will not be a chance to present your side of the story, there will be the opportunity to challenge the amount of damage. There is a chance a lot will be awarded, perhaps even more than the amount of available insurance coverage. Worst of all, the lack of notification of your business could result in denial of coverage that would have been available if the request was promptly reported.
Once your insurance company has received the summons and complaint, you should hear your claims manager the same day or the next business day if the documents arrive in the late afternoon or after work is closed. If you hear someone in a day or two, give your insurance company a call
The first thing your claim manager will do is what I consider to be one of best parts of my job :. Reassure you that they are on top of the situation, describe what to expect, and answer any questions you might have about the process. Then your business will seek to settle all claims due as quickly as possible, from time to time on the other side is either reluctant to admit their own responsibility or has unrealistic expectations and result in a lawsuit. These combinations are often resolved well before the case goes to trial.
Sometimes there is a concern the damages claimed or awarded exceed the amount of coverage on the policy. When this happens, your company will defend the suit, but will inform you of the potential for a price that exceeds the coverage. You can retain separate counsel to help defend your exposure short if you like.
Unfortunately, there are occasions where your business can find the allegations in the complaint are not covered by the policy. They may need more time to study the situation before making a coverage decision. Under the policy, the specific allegations, and local law, the company can still provide a defense, but you put on notice of coverage issues in a document called Reservation of Rights or a non-waiver agreement. If no claims are covered, or if the loss is outside of your company's coverage period, they might have to send a refusal; however, if the complaint was sent immediately, it should still be time for you to answer in the time limits set by the Court.
Have you received a summons and complaint? How have you handled the situation and how was it resolved?
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