The Right to Select Counsel, Part 2

The Right to Select Counsel, Part 2

This is continuation of our series, “The Right to Select Counsel” For part 1, click here.

Location Matters

While the previous example seems reasonable, every state has different requirements for independent counsel.

  • New York requires a reservation of rights to result in a conflict of interest before a policyholder can insist on their own choice of independent counsel; the insurer may even be required to notify the policyholder of their right to seek independent counsel.
  • In Massachusetts, on the other hand, simply the existence of a reservation of rights is sufficient to trigger a policyholder’s right to select counsel.
  • Connecticut requires defense counsel to owe a “duty of loyalty” only to policyholders, regardless of whether the insurer selects or only pays for counsel. However, it is unclear in Connecticut when a policyholder has the ability to select independent counsel.


Beyond Conflict of Interest

 If a conflict of interest is not apparent, there are other reasons that policyholders may request counsel of their own choosing:

  • If an insurer hasn’t been involved in the defense of a lawsuit since the beginning of its inception, it may be prejudicial and detrimental to bring in new counsel in the middle of ongoing litigation. Also, it would be needlessly time-consuming and costly.
  • A policyholder’s personal counsel may be better-suited to defend the policyholder because of such counsel’s personal knowledge of the policyholder and their particular situation. This is especially true for corporate policyholders, as they’ll have a deeper understanding of the corporation’s operations, which may be important to the defense.
  • If the policyholder is able to select their own counsel, there still may be disputes regarding pay rates and compensation that the insurer must pay. For instance, an insurer may argue that they only need to pay rates that they typically pay for panel counsel. Of course, this creates more conflict, as it is usually determined that rates should be based on what is reasonable.
  • There’s also the consideration that should be made for the experience and reputation of the selected counsel. If an insurer wants to “sabotage” a case to ensure that their not held liable for their responsibility, thus exposing the client to more remuneration.


This is only the tip of the iceberg when it comes to reasons besides an obvious conflict of interest. Further reasons may include the location of which court the legal proceedings should be held, the nature of the underlying litigation, and so forth.


What’s a Policyholder to Do?

Policyholders must be aware of their responsibility to choose what is in the best interests of their case It can be argued that allowing a policyholder to choose their own counsel may benefit both the policyholder and the insurer. However, because insurers typically deal with dozens of cases, a policyholder should be open-minded to working with counsel provided.

If there is a dispute about the selection of counsel, it is advised that the policyholder and the insurer work together to resolve any issues that may appear; these disputes could work against both parties when the real focus should be on defending against the claims.


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In conclusion, knowing when to select counsel as a policyholder can mean the difference between defending yourself or paying out-of-pocket when an insurance company jumps ship. While it may be wise to consult a lawyer, it is even wiser to hire an insurance advisor that understands your particular interests. Contact RiskBlock today  to ensure that you and your family are protected.

Author: Liam Dai
Lead Insurance Advisor for RiskBlock. Disclaimer: This Blog/Web Site is made available by the author or insurance agency for educational purposes only as well as to give you general information and a general understanding of the insurance coverage, not to provide specific insurance advice. By using this blog site you understand that there is no professional advice and professional client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for professional advice from a licensed professional insurance agent in your state. All scenarios are different and unique to the situation.