Most if not all liability insurance policies have clauses dealing with supplementary payments: the standard business auto policy, personal auto policy, and general liability policy all contain supplementary payments sections.

The standard homeowners policy has its claim expenses provisions (note that these are standard Insurance Services Office forms). These provisions usually contain few or no controversial words or phrases that cause major coverage disputes when an insured presents a claim to the insurer. However, being noncontroversial does not mean supplementary payments are not important and not an integral part of the insurance policy.

The first provision in the supplementary payments clauses states that the insurer will pay the expenses it incurs (note that the standard personal auto policy puts this provision last). This seems reasonable since the insurer not only has the duty to defend the insured against covered liability claims, but also takes upon itself the right to settle any claim or lawsuit that is filed against the insured. This duty and right obviously involve expenses and in exercising that duty and right, the insurer should be responsible for the payment of those expenses.

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