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Expert Analysis

Calif. Does Not Bar Defense Coverage For 'Willful Acts'

By Darren Teshima and Harry Moren ( June 23, 2017, 10:55 AM EDT) -- California prohibits insurers from indemnifying policyholders for their intentional misconduct, as a matter of public policy and as codified in California Insurance Code section 533. This bar on insurance coverage, however, does not necessarily bar insurers from providing or paying for a defense against accusations of wrongful conduct. When California policyholders tender a complaint alleging intentional wrongdoing — such as a qui tam lawsuit alleging False Claims Act (FCA) violations — they should not simply accept an insurer's broad coverage denial relying upon Section 533....

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