The Liability Insurer's Duty to Settle Uncertain and Mixed Claims

Abstract

The liability insurer’s duty to settle in conventional cases is well-established. However, the scope of the duty to settle cases in which coverage is uncertain, and to settle “mixed” claims in which some allegations are clearly covered and others are not, is not well-established. This Article describes the conceptual terrain on which the issues in such cases arise, identifies the advantages and disadvantages of possible approaches, and explains how these advantages and disadvantages interact.

Keywords: liability insurance, duty to settle

JEL Classification: K23