It is Halloween week, and one of the most frightening things most people could receive this week from a legal perspective is a “Reservation of Rights” letter from their insurance company. What is this letter about and what should you do if you receive a Reservation of Rights letter from your insurance company or their legal team?
The Reservation of Rights letter is known in the insurance industry as a “denial letter.” This letter basically says that your insurance company will defend you per the terms of your insurance policy, but they reserve the right to deny your coverage at any time in the future. It also gives them the ability to refuse to cover a portion or all of the financial liabilities that will result from your claim. This letter must contain specific reasons and an explanation of why the specific facts in your claim may result in the denial of all or part of your insurance coverage.
The Reservation of Rights letter from your insurance company is a huge red flag, but you have some powerful legal options at your disposal. We invite you to call for a free consultation at 858-535-1511. Your insurance company is posturing, and you can fight back. Best of all, it may not cost you anything out of pocket! The first option is what is known as a “Cumis Counsel” under California law. You see, the insurance company attorneys have a legal conflict of interest. They owe their primary allegiance to the insurance policy itself, even though you are the insured and you are the one who has paid all of the premiums and purchased insurance to protect you from just this type of situation.
California law protects you by providing your own independent counsel – known as Cumis Counsel – to represent you in every conversation, hearing and legal venue while your lawsuit is being negotiated, mediated or tried. Your own insurance company must pay for your cumis counsel if your situation qualifies under California law. Another option is what is known as insurance bad faith. Insurance companies attempt to deny every possible claim. They do not profit by paying your claim. They profit by collecting your premiums and then trying to deny coverage when a claim arises. The experienced cumis counsel and insurance coverage attorneys at the Watkins Firm can review your policy and hold your insurance company accountable under the legal terms of your own policy.
The call is free, and the risk you face as a result of receiving a Reservation of Rights letter from your insurance company is actually quite real. Protect yourself and call 858-535-1511.