Bollam v. Fireman's Fund Insurance

In an action for damages by insureds against their liability insurer for negligent management of a claim against them, does their cause of action accrue (1) when the insureds are aware that the claim cannot be settled within their policy limits and as a result of the negligence incur attorney fees to protect their own interests, or (2) when they later pay their own funds to the claimant in order to settle the claim? 1 We hold that the cause accrues when they incur attorney fees as a result of the insurer’s negligence.

On January 23, 1975, plaintiffs were involved in a motor vehicle collision…