Contract Litigation Insurance.
Now Available For Defendants, As Well As Plaintiffs. (click here to find out more)
Insurance coverage against paying an adversary’s attorneys’ fees for individuals, businesses and corporations.
As a general matter, certain contracts provide that, if a lawsuit arises out of the contract, the prevailing party in the litigation is entitled to recover their attorneys’ fees from the losing party. Contract Litigation Insurance (CLI) is the first-of-its-kind insurance coverage that is specifically created to help protect both plaintiffs and defendants from the risk of having to pay their adversary’s attorneys’ fees. The policy is underwritten by individual member companies of Zurich in North America, a leading global insurance carrier rated "A" by A.M. Best.*
How The Policy Works.
A CLI policy works much like other common types of insurance policies, such as home, auto or health. Premiums are charged for the amount of insurance coverage, and claims are paid out to the insured when a loss materializes. However, unlike other forms of insurance, there is no complicated claims adjustment process associated with CLI policies. Indeed, in most instances, Sonoma Risk expects to pay the court-ordered award of attorneys’ fees up to policy limits.
In addition, a CLI policy is issued only after a complaint has been filed with the court, providing litigants protection when they are actually exposed to a recognizable risk. The policy provides protection against this risk exposure until the case ends and the possibility of having to pay an adversary’s attorneys’ fees is eliminated.
Fair-Minded Premiums.
At Sonoma Risk, it’s our policy to provide litigants with fair-minded premiums. Litigants can obtain coverage on virtually any breach-of-contract lawsuit with a “fee shifting provision.” Policies can be applied for any time within the first 60 days of the initial filing (for a plaintiff) or 60 days of service of the underlying complaint (for a defendant).
Outstanding Service. Expedient Claims.
Contract Litigation Insurance was developed by an experienced team of attorneys and insurance professionals with a deep understanding of the complexities of lawsuits and the importance of personalized service. Our Litigation Insurance Specialists guide and support policyholders throughout the entire life cycle of the policy – from helping them determine the right amount of coverage to obtain, to processing a claim in the most professional and expedient fashion.
New Defendant Policy Now Available.
As the leading provider of insurance products that help alleviate the financial risk associated with litigation, we’re proud to introduce another industry first - Defendant Contract Litigation Insurance (DCLI).
This new policy for defendants extends and expands our coverage options and is specifically designed to help protect defendants from having to pay their adversary’s attorneys’ fees as a result of a fee shifting provision in a contract.
With Contract Litigation Insurance, plaintiffs and defendants can feel more secure about the uncertainties associated with litigation, including financial risk and budget concerns. After all, you can be right in litigation and still lose.
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*Rating information is provided as of 8/4/2010. For information about the ratings of Zurich American Insurance Company, access the ratings section on www.zurichna.com. For more complete financial information about the Zurich Financial Services Group and ratings for Zurich Insurance Company Ltd., access www.zurich.com.
