Question

Expenses incurred in defending a liability suit covered under Section II part E of the Homeowners policy are: (SELECT ONE)

• not payable under the policy.

• payable, in addition to the policy limit of liability.

• not payable if the limit of liability has been reached unless a expenses endorsement has been issued.

• are not covered.

• payable, together with any judgment, up to the policy limit.

Answer 1

Expense incurred in defending a liability suit under section II Part E of the home owners policy are:

• Payable, in addition to the policy limit of liability

Under section II Part E of homeowners policy, this deals with coverage of suit against an insured beacuse of bodily or property damages made by the act of the insured. Under this the insurance company will have to pay expenses incurred in defending a liability suit which is payable in addition to the policy limit of liability

For example,

If policy limits are $25000 and the defense cost are $27000,

the insurance company will have to pay a total of ($25000+$27000)$52000 on behalf of the insured