Blue Ridge Insurance v. Jacobsen

Opinion

BROWN, J.

In response to the request of the Ninth Circuit Court of Appeals, we answer the following certified question: “Whether an insurer defending a personal injury suit under a reservation of rights may recover settlement payments made over the objection of the insured when it is later determined that the underlying claims are not covered under the policy.” (Blue Ridge Ins. Co. v. Jacobsen (9th Cir. 1999) 197 F.3d 1008, 1009 (Blue Ridge); Cal. Rules of Court, rule 29.5.) Here, at the time it accepted defense of the insureds, the insurer reserved its right to dispute coverage for any…