Our insured carries a general liability policy (CG 00 01 12 07). The insurance company believes that under the insured's policy, there is no obligation to offer defense under this suit. The insurer argues that there is no coverage for the claim, because this is a matter of a debt collection, not a bodily injury or property damage claim. The insured argues that the second allegation triggers the company's obligation to offer defense under this suit since this could be covered under the personal injury section of the general liability policy.

What is your opinion about this issue?

Florida Subscriber

The insured may have a point. The CGL form applies to personal and advertising injury which is defined as oral or written publication in any manner of material that slanders or libels a person or organization or disparages a person's or organization's goods, products or services. So, the question is whether the insured publicized its disputes with the construction company and in doing so, disparaged the company's services. You need some more facts to see exactly what the insured did or did not do. Publication of the material would mean informing the general public of the disparagement. If the insured is simply not paying the balance and fighting a lawsuit over that, we do not see the insured publicizing its criticism of the company to the general public so the definition of personal and advertising injury is not being met. But, you need to know exactly what the insured did or did not do in this instance to be sure about the CGL coverage or lack of it. Until there is some clarification on this point, the insurer would be wise to offer a defense accompanied by a reservation of rights letter to the insured.