Will the personal liability in a homeowners insurance cover legal fees to defend the homeowner from wrongful accusation for “embezzlement”… thanks
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UPDATED: Oct 12, 2011
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Insurance Question from Rancho Santa Margarita, CA
Asked on 10/12/2011
Will the personal liability in a homeowners insurance cover legal fees to defend the homeowner from wrongful accusation for “embezzlement”… thanks NULL
Answer given on October 14, 2011
Homeowner policies provide personal liability protection and pays for legal fees for defense of covered losses. However, the policy covers for personal issues, not business related losses. If the embezzlement accusation is related to your occupation or business, then the homeowner policy will not defend you.However, if the charge is personally related then they will work with you.Homeowner policies also do not cover their insureds for illegal activities. They may agree to defend but if you are found guilty, they may withdraw their defense and refuse to make any payments.You need to contact your agent or company and present a claim for the accusation. The adjuster will determine if there is coverage under the policy and will advise you how they will proceed. If they deny coverage, you should be sure you understand why they are denying coverage and see if there is an alternative or if you can work with them to provide defense.
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