The Criteria when the Assured is Reluctant to Exercise His Right for Indemnity in the Liability Insurance

In the liability insurance, only when the assured is reluctant to exercise his right for insurance indemnity to the insurer, the third party who suffers the loss could be entitled the right to make a claim directly against the insurer for the payment of insurance benefits. Two aspects, namely the manner and the time of the request, should be considered when assessing whether the case falls within the criteria. As for the manner, it can be considered as ‘reluctant’ that the assured fails or delays to request within a reasonable period of time, when he should and is also able to request the insurer to pay the insurance benefits directly to the related third party after the insurer’s liability has been determined (i.e. the request is legally equivalent to initiation for the insurance claims procedure). In terms of the time, it can be considered as ‘reluctant’ when the third party files against the insurer, the assured has yet to request the insurer to pay the related third party insurance benefits directly.