Personal Auto PolicyQuestion 383 of 531
The insurer's duty to defend an insured under Part A of the personal auto policy comes to an end when:
a.The claimant's demand rises above the policy limit
b.The limit is exhausted by payment of a judgment
c.The suit has been pending a full policy year
d.The insured asks the insurer to stop paying
Explanation
The insurer must defend any suit asking for damages the policy covers, and it may investigate and settle as it thinks proper, but that duty ends once the limit of liability has been used up by payment of judgments or settlements. A demand that merely exceeds the limit does not end it; the money has to actually go out the door. The passage of time does not end it either.
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