prudent insurer standard

A legal test by which the reasonableness of an insurer’s decision to reject a policy limits demand may be measured. (Crisci v. Security Ins. Co. (1967) 66 Cal.2d 425, 429 “In determining whether an insurer has given consideration to the interests of the insured, the test is whether a prudent insurer without policy limits would have accepted the settlement offer.”) The alternative is the Own Risk Standard.

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