Does Homeowners Insurance Pay for Legal Fees?

Homeowner's insurance protects against occurrences that damage the insured's residence. A common reason for purchasing such insurance is because mortgage firms and other lending institutions want the coverage to safeguard their financial interests in real estate investments. These policies also protect insureds from lawsuits made against them by third parties who claim they were injured or harmed due to the owner's negligence. When homeowners desire higher liability limits and protection against a greater variety of claims, they will be required to pay higher rates.

Fees and Costs of Legal Counsel

Generally, a homeowners insurance policy will pay to settle a claim against an insured. The policy covers the claim and that the homeowner's carelessness was genuinely responsible for the losses. In addition to the settlement expenses, the insurer will cover the costs of defending the insured against the claim brought against them. For instance, if an insured person is sued because her dog bit a guest on her property, the homeowner's insurance company will almost always engage an attorney to defend the insured person's position.

Claims That Are Frequently Covered

Most homeowner's insurance policies give coverage for specific sorts of losses. Claims for dog bites are usually covered by insurance. Claims for libel and slander are also barred. Personal injury claims are also typically covered under this policy. As a result, if a visitor slips on a homeowner's walkway and subsequently sues the homeowner for negligence, the insured's homeowners insurance would generally cover the claim and provide a defense against the lawsuit.

Claims That Are Not Included

Other forms of claims are often not covered by insurance policies. If an insured issued a result of an incident that was not covered by the homeowners' policy, the insurer would normally inform the insured that no coverage is available to him or her under the policy. In most cases, intentional acts are not covered by homeowner's insurance. Suppose a homeowner shoots someone on his property, and the intruder sues the homeowner for his injuries. Most homeowners' policies will not give coverage in this situation. Some policies may provide a provision for self-defense, but the majority will not. The insurance company will almost always deny coverage for claims of sexual harassment, molestation, or assault.

Disputes With The Insurance Company

A claim may be denied if the insured and the insurer do not agree on whether the claim should be covered. Policy requirements can be complicated, especially when applied to a specific factual situation. Generally speaking, an insurer's obligation to defend an insured is greater than its duty to repay it in most jurisdictions. Suppose the accusations in a lawsuit against a homeowner have the potential to trigger coverage. In that case, insurers are generally obligated to defend the insured, at least until a judge determines that the policy does not cover the claim in question. It is legal in some states for insureds to launch bad-faith lawsuits against insurance companies that have unlawfully refused to pay for legal costs and fees in such circumstances.