Insurance is one of those things most people pay for and hope they never have to use.
That's because, if you have to call upon your insurance policy, something bad probably happened (like you got sued or a storm damaged your property). Thankfully, the law provides some extra protection by requiring insurance companies to comply with contractual and implied duties.
Duty to pay
The insurance policy itself is a contract. It requires the insurance company to pay for certain specified damages or losses. For example, if you cause a car accident that injured another person, then your auto insurance policy will require the insurance company to pay for the other person's resultant damages (up to your policy limits).
For example, if you cause a car accident that injured another person, then your auto insurance policy will require the insurance company to pay for the other person's resultant damages (up to your policy limits).
Duty to defend
Another contractual obligation under a liability insurance policy is the duty to defend. Under this duty, the insurance company pays for your attorney if you get sued. The defense obligation particularly is important to most people because attorneys' fees can add up quickly if you have to pay for them out of your own pocket.
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