USE NOTES: This Model Letter assumes that the insurer has reserved rights to deny coverage, hired its lawyer, and assumed control the policyholder’s defense. It should be signed by independent counsel. Adapt the template below by using inserting correct information for terms bracketed by &&.
City, State Zip Code
Re: &Plaintiff& v. &Client&
Your Claim No. &Blank&
Your insured, &Client&, has hired this firm to represent him/her as independent counsel in the lawsuit entitled &Plaintiff& v. &Client&. This firm has at least five years of civil litigation practice which includes substantial defense experience in the subject at issue in the litigation, and errors and omissions coverage, evidenced by the enclosed copy of our current declarations page. Please advise promptly that &InsCo& agrees unconditionally that it has a duty to defend the lawsuit and that a conflict of interest exists which requires it to provide independent counsel to &Client&.
&IndependentCounsel& has a written retainer agreement with &Client&, a copy of which is enclosed. The retainer obligates &Client& to pay our fees and costs advanced within 30 days, following which interest at the legal rate of ten percent (10%) per annum begins to accrue. &Client& has granted to &IndependentCounsel& an attorneys’ lien on “&InsCo&’s obligation to pay for the defense.
Because Cumis counsel has no attorney client relationship with &InsCo&, Rule 1.7 prohibits us from establishing any relationship with &InsCo&. Instead, &InsCo&’s obligation is to provide independent counsel runs to &Client&. &IndependentCounsel& will submit invoices to &InsCo& on behalf of &Client&, each of which &InsCo& should process as claims by &Client&. &InsCo& should honor our lien by checks made payable to “&IndependentCounsel&”. &InsCo& should pay invoices “immediately, but in no event more than thirty (30) calendar days” as required by Code of Reg. § 2695.7(h) to fulfill its duty to defend and to avoid incurring interest charges.
Enclosed are copies of our recent invoices. We have allocated our time so as not to show any time on these bills for prosecuting any affirmative claims nor any insurance coverage work. If you have any questions about the invoices, please promptly call me.
Very truly yours,