Denial of Coverage

A formal determination by an insurance carrier that a reported claim does not fall within the scope of the policy's coverage and that the carrier has no obligation to defend or indemnify the insured. Common grounds for denial include late notice, acts predating the retroactive date, excluded practice areas, and intentional or criminal conduct. An insured who receives a denial should carefully review the denial letter, the policy language, and applicable state insurance law, as improper denials may give rise to bad faith claims against the carrier.