Insurance Law Lesson 23: The 8 Corners of Liability Insurance

The 8 corners doctrine refers to comparing what is in the “four corners” of the complaint (lawsuit) with that which is in the “four corners” of the policy.

This is the starting point for a duty to defend analysis. Some states strictly apply the 8 corners doctrine strictly. If the allegations do not explicitly implicate coverage, then there is no duty to defend. Others take a looser approach.

In Michigan, the duty to defend is triggered “if the allegations of the underlying suit arguably fall within the coverage of the policy….” Royce v. Citizens Ins. Co., 219 Mich.App. 537, 543, 557 N.W.2d 144 (1996). “The insurer has the duty to look behind the third party’s allegations to analyze whether coverage is possible” and doubts are resolved in the insured’s favor.” Detroit Edison Co. v. Michigan Mut. Ins. Co., 102 Mich.App. 136, 141-142 (1981).

But what if the doubt is whether the person is an insured? Insurer will argue that a person who (they assert) is not an insured is not entitled to the contractual benefit of the doubt. I do not believe this has been decided yet in Michigan.

Leave a Reply