We have a question about the carrier's liability in a case involving a default judgment against our insured. The situation involved a car accident in which a young man was running an errand in his parents' car. He was covered under their auto policy. The young man struck and severely injured a pedestrian. He fled the scene and was soon caught by the police. Several witnesses said that the driver was driving much too fast for conditions in the residential area.
The driver was released on bail and disappeared before the insurer could get him to cooperate in the defense. He did not show up for trial and a default judgment was entered against him. We are wondering if the insurer will be held liable in such a case even though the insured failed to comply with the cooperation requirement of the policy.
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