Insurers Not Entitled To Paid Defense Costs: Pa. Court

Law360, New York (August 18, 2010, 5:49 PM EDT) -- The Pennsylvania Supreme Court has affirmed a finding that American & Foreign Insurance Co., Royal Insurance Co. of America and others are not entitled to reimbursement of defense costs expended before a court found they had no duty to defend a policyholder.

The state's high court said Tuesday it would be inconsistent with Pennsylvania law to permit the reimbursement of defense costs expended prior to a court’s determination of coverage if an insurance contract is silent about those costs.

“It would amount to a retroactive erosion...
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