“We conclude the Canons of Ethics impose upon lawyers hired by the insurer an obligation to explain to the insured and the insurer the full implications of joint representation in situations where the insurer has reserved its rights to deny coverage. If the insured does not give an informed consent to continued representation, counsel must cease to represent both. Moreover, in the absence of such consent, where there are divergent interests of the insured and the insurer brought about by the insurer’s reservation of rights based on possible noncoverage under the insurance policy, the insurer must pay the reasonable cost for hiring independent counsel by the insured.”
“The obligation of an insurer to provide independent Cumis counsel for an insured is premised on the ethical inability of an attorney to represent conflicting interests.” “[T]he Cumis rule is not based on insurance law but on the ethical duty of an attorney to avoid representing conflicting interests.” “Cumis is based on ethical standards, not on insurance concepts.” “The Cumis opinion was based heavily on the canons of ethics and the possibly conflicting choices confronting an attorney”
“In California, an attorney may usually, under minimum standards of professional ethics, represent dual interests as long as full consent and full disclosure occur.” But “an attorney representing two parties with divergent interests must disclose all facts and circumstances which, in the judgment of a lawyer of ordinary skill and capacity, are necessary to enable his client to make free and intelligent decisions regarding the subject matter of the representation” “That [dependent counsel] represented conflicting interests in the [liability] action is now plain. . . . [T]he consent of the [policyholder] to [dependent counsel’s] representation of conflicting interests was never obtained.”
 San Diego Navy Fed. Credit Union v. Cumis Ins. Society, Inc. (1984) 162 Cal.App.3d 358, 375.
 United Pac. Ins. Co. v. Hall (1988) 199 Cal. App. 3d 551, 556.
 Golden Eagle Ins. Co. v. Foremost Ins. Co. (1993) 20 Cal. App. 4th 1372, 1394.
 Mosier v. S. Cal. Physicians Ins. Exch. (1998) 63 Cal. App. 4th 1022, 1042.
 Blanchard v. State Farm Fire & Casualty Co. (1991) 2 Cal.App.4th 345, 350.
 Lysick v. Walcom (1968) 258 Cal.App.2d 136, 147.
 Ishmael v. Millington (1966) 241 Cal.App.2d 520, 528.
 Industrial Indem. Co. v. Great American Ins. Co. (1977) 73 Cal. App. 3d 529, 537.