Settling liability claims can be one of the most challenging areas of insurance law. The insurer and insured may disagree as to whether to settle at all or how much to pay to settle. Multiple claimant/multiple insured claims, mixed claims, excess demands, demands for punitive damages, and claims where the insured has an affirmative claim for relief may further complicate the analysis and the negotiations. Whether the insurer should seek from the policyholder, or the policyholder offers to make, a settlement contribution presents thorny issues, including whether such a contribution can convert an excess demand into a demand within limits—which, in turn, affects the standard for evaluating the insurer’s response to the third-party demand. Read the full article published by the American Bar Association Section for Litigation Members*.

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