Also known as: liability insurance coverages · liability coverage · liability insurance
Written by attorneys · grounded in primary & secondary sources — see below
A contractual arrangement under which an insurer agrees to pay damages arising from the insured's tortious conduct up to specified limits and to provide a defense against claims.
Lucas Lee was injured when a truck owned by Legacy Motors struck his vehicle. He filed a federal suit directly against the liability insurer without naming the company as a defendant. The court assessed diversity jurisdiction by treating the insurer as a citizen of every state where Legacy Motors was incorporated and maintained its principal place of business.
Lighthouse Shipping purchased equipment from a British firm whose U.S. distributor sold the product nationwide. After a worker was injured, the firm noted in correspondence that it maintained products liability insurance coverage for U.S. claims. The court examined whether those insurance arrangements supported minimum contacts sufficient for personal jurisdiction over the foreign manufacturer.
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Latoya Lane suffered serious injuries in a collision with a vehicle insured by Traders & General. The insurer refused to settle within policy limits despite a reasonable opportunity. Lane obtained a judgment exceeding the limits and then sued the insurer for bad faith failure to settle under the liability insurance coverage.
Liberty Trust and other insurers coordinated reinsurance terms for liability policies sold to California municipalities. State officials challenged the arrangement as a boycott violating federal antitrust law. The insurers defended on the ground that the coordinated liability insurance coverage fell within the McCarran-Ferguson exemption.
Landon Long was injured by a taxi owned by one of ten corporations controlled by Carlton. Each corporation carried only the statutory minimum liability insurance coverage. Long sought to pierce the corporate veil to reach Carlton personally, arguing the undercapitalized insurance arrangement demonstrated an abuse of the corporate form.
Luke Latham, a California resident, was injured while working on an offshore platform operated by Continental Oil. The employment contract and liability insurance policy were negotiated in Louisiana. The court applied California law to determine the scope of the liability insurance coverage after weighing the competing state interests.
Evidence of liability insurance is inadmissible to prove that a person acted negligently or wrongfully. The rule permits admission when the evidence is offered for another purpose such as proving bias of a witness, agency, ownership, or control.
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No. The rules of evidence bar using the existence of liability insurance to prove negligent conduct because jurors might improperly infer that the insured felt free to act carelessly or that an insurer can simply pay the loss.
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Yes. Partnership law permits a partnership to purchase and maintain insurance on behalf of a partner against liability asserted in that capacity even when the partnership agreement cannot eliminate or limit the partner's personal liability for the underlying conduct.
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…refund— a planned vacation at the last minute. The fact that the cruise line can reduce its litigation costs, and therefore its liability insurance premiums, by forcing this choice on its passengers does not, in my opinion, suffice to render the provision reasonable. Cf. Steven v. Fidelity & Casualty Co. of New York , 58 Cal. 2d…