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What are the possible benefits of notifying my insurance company before a lawsuit?

UPDATED: August 7, 2012

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Depending upon the basis for the lawsuit, you may be covered by liability insurance that will both pay for the cost of your defense and any judgment that you may owe (up to the amount of your coverage).

Homeowners policies and umbrella policies often offer very good protection that many people are not aware of. (Former President Clinton found that out to his good fortune when an insurance broker suggested his old personal Arkansas’ umbrella policy required the insurer to advance the cost for some of his defense in the Paula Jones case.) Your employer may also have insurance covering you if the litigation has any connection with your employment.

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