Do you, as the Insured, have a right not to file a claim, by a third party, on your insurance policy?
Actually, no, unless you want to forfeit your insurance coverage. Guess whose pocket the costs will come out of for defense and damages. What if you feel you are not responsible? Doesn’t matter. Your insurance policy contains terms and conditions just as your contract does with your clients. Included in that insurance policy are conditions regarding your duties in the event you have been notified of a claim or an occurrence that might result in a claim against your insurance coverage. If you violate the loss reporting provisions of the insurance policy your insurance company can use that as grounds to deny coverage. Keep in mind that the insurance company isn’t just going to hand over money to a claimant because they say you are at fault. There is investigation, disclosures, depositions, etc. that must be conducted before Liability can be determined. In addition, if you have reported this to your agent, your insurance agent may be bound in their contract with the insurance company to notify them if their Insured has made them aware of a claim or a potential claim. Thank you to the Independent Insurance Agents & Brokers of America, Inc. who provide Errors & Omissions Loss Control strategies to their members, like us, which in turn helps us to help you prevent a denial of insurance coverage determination.