Warning
Info
Warning
Info
Simple English definitions for legal terms
eight-corners rule
Read a random definition: Farmers' Home Administration
A quick definition of eight-corners rule:
Eight-Corners Rule: This is a rule that says an insurance company must defend and protect their customer if they are sued for something covered by their insurance policy. The insurance company must look at the language in the policy and the language in the lawsuit to decide if they have to defend their customer. They cannot consider any other information outside of these "eight corners" (four corners of the policy and four corners of the lawsuit).
A more thorough explanation:
The eight-corners rule is a principle in insurance that states that a liability insurer has a duty to defend its insured. This means that the insurer must provide legal representation and pay for legal fees if the insured is sued for damages that are covered by the insurance policy.
The name "eight-corners" refers to the fact that the insurer's duty to defend is determined by examining the four corners of the insurance policy and the four corners of the complaint or lawsuit filed against the insured. The goal is to determine whether the allegations in the complaint fall within the scope of coverage provided by the policy.
For example, if a person is sued for causing a car accident and their insurance policy covers liability for car accidents, the insurer has a duty to defend the insured in court. However, if the policy only covers liability for property damage and the lawsuit is for personal injury, the insurer may not have a duty to defend.
The eight-corners rule is important because it helps ensure that insurers fulfill their obligations to their policyholders. By examining the policy and the complaint, the insurer can determine whether the claim is covered and provide legal representation if necessary.