Does an insurer have the right to recover defense costs and fees from an insured? (Photo: Shutterstock) Does an insurer have the right to recover defense costs and fees from an insured? (Photo: Shutterstock)

In American West Home Insurance Co. v. Gjonaj Realty & Management Co., the New York Appellate Division, Second Department addressed an issue of first impression — that is, whether an insurance company may recover the costs of defending its insureds in an underlying personal injury action "where there has been a reservation of rights by the insurance company and a determination by the court that the insurance company has no obligation to defend and provide insurance coverage to the insureds" in such action.

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