In any lawsuit, it is imperative that counsel have a detailed understanding of the nature of insurance coverage that may be available to defend and potentially indemnify the defendant for claims made against it. From the plaintiff’s perspective, triggering insurance coverage may very well mean the difference between receiving cash money or being left holding an empty bag, even if victorious at trial. For that reason, plaintiff’s counsel must know how to “plead to coverage” to ensure the best chances of a monetary recovery. To be able to “plead to coverage,” it is critical to know and understand the types of insurance policies that are most likely to be held by the defendant and how to craft a complaint to trigger coverage under those particular policies. The factual allegations in a complaint that relate to insurance coverage are just as important as alleging all of the legal elements of the causes of action. From the defendant’s perspective, payment of defense fees alone can have a crippling effect on a business. Having a defense provided by an insurance company may mean the difference between mounting a successful defense or a business closing its doors because it does not have the financial wherewithal to fund a defense. The availability of insurance money to fund a settlement or judgment is also obviously critical. Breach of contract claims and business tort claims such as those for breach of fiduciary duty, fraud, unfair trade practices, tortious interference, trademark infringement, and theft of trade secrets are often covered, at least in part.
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