The carrier’s denial was based on a policy provision that required the Insured to produce a copy of a hold harmless agreement between the Insured and the subcontractor at issue. According to the carrier, such an agreement would allow the association or their carrier to tender to the subcontractor to defend and indemnify them for the claim; therefore, the contract was viewed as a vital piece in the coverage analysis. Although the Insured’s attorney was attempting to obtain the document, it had not yet been received because the prior owner of the property (who had entered into the agreement) was refusing to cooperate.

In responding to the denial, CRC’s Claims Advocacy Team reminded the carrier that to validly deny a defense to the insured, the burden was on the carrier to prove that there was absolutely no potential coverage for the loss. And because the allegations of the complaint triggered coverage, the missing hold harmless agreement was not sufficient to meet that burden.

When the adjuster refused to budge, CRC reached out to the adjuster’s supervisor, reiterating the arguments for coverage. The supervisor agreed that the carrier could have a duty to defend, so he sent the claim to coverage counsel for expedited review. Shortly thereafter, the carrier rescinded its denial and agreed to provide a defense under a Reservation of Rights.

In the end, the carrier retained counsel on behalf of the Insured in time for the hearing. By thoroughly reviewing the facts, applying claims process knowledge, and communicating clearly with the right people, the Claims Advocacy Team was able to achieve a quick victory and demonstrate just how skillful they are in helping insureds and convincing carriers to do the right thing.

To learn more about CRC Group's Claims Advocacy Team, contact your CRC producer.