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- Alaska Statutes.
- Title 21. Insurance
- Chapter 89. Miscellaneous Provisions
- Section 100. Appointment of Independent Counsel; Conflicts of Interest; Settlement.
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AS 21.89.100. Appointment of Independent Counsel; Conflicts of Interest; Settlement.
- (a) If an insurer has a duty to defend an insured under a policy of insurance and a conflict of interest arises that
imposes a duty on the insurer to provide independent counsel to the insured, the insurer shall provide independent
counsel to the insured unless the insured in writing waives the right to independent counsel. An insurance policy may
contain a provision that provides a method of selecting independent counsel if the provision complies with this
- (b) For purposes of this section, the following do not constitute a conflict of interest:
- (1) a claim of punitive damages;
- (2) a claim of damages in excess of the policy limits;
- (3) claims or facts in a civil action for which the insurer denies coverage.
- (c) Notwithstanding (b) of this section, if the insurer reserves the insurer's rights on an issue for which coverage is
denied, the insurer shall provide independent counsel to the insured as provided under (a) of this section.
- (d) If the insured selects independent counsel at the insurer's expense, the insurer may require that the independent
counsel have at least four years of experience in civil litigation, including defense experience in the general subject
area at issue in the civil action, and malpractice insurance. Unless otherwise provided in the insurance policy, the
obligation of the insurer to pay the fee charged by the independent counsel is limited to the rate that is actually
paid by the insurer to an attorney in the ordinary course of business in the defense of a similar civil action in the
community in which the claim arose or is being defended. In providing independent counsel, the insurer is not
responsible for the fees and costs of defending an allegation for which coverage is properly denied and shall be
responsible only for the fees and costs to defend those allegations for which the insurer either reserves its position
as to coverage or accepts coverage. The independent counsel shall keep detailed records allocating fees and costs
accordingly. A dispute between the insurer and insured regarding attorney fees that is not resolved by the insurance
policy or this section shall be resolved by arbitration under AS 09.43.
- (e) If the insured selects independent counsel at the insurer's expense, the independent counsel and the insured shall
consult with the insurer on all matters relating to the civil action and shall disclose to the insurer in a timely
manner all information relevant to the civil action, except information that is privileged and relevant to disputed
coverage. A claim of privilege is subject to review in the appropriate court. Information disclosed by the independent
counsel or the insured does not waive another party's right to assert privilege.
- (f) An insured may waive the right to select independent counsel by signing a statement that reads substantially as
I have been advised of my right to select independent counsel to represent me in this lawsuit and of my right under
state law to have all reasonable expenses of an independent counsel paid by my insurer. I have also been advised that
the Alaska Supreme Court has ruled that when an insurer defends an insured under a reservation of rights provision in
an insurance policy, there are various conflicts of interest that arise between an insurer and an insured. I have
considered this matter fully and at this time I am waiving my right to select independent counsel. I have authorized my
insurer to select a defense counsel to represent me in this lawsuit.
- (g) If an insured selects independent counsel under this section, both the counsel representing the insurer and
independent counsel representing the insured shall be allowed to participate in all aspects of the civil action.
Counsel for the insurer and insured shall cooperate fully in exchanging information that is consistent with ethical and
legal obligations to the insured. Nothing in this section relieves the insured of the duty to cooperate fully with the
insurer as required by the terms of the insurance policy.
- (h) When an insured is represented by independent counsel, the insurer may settle directly with the plaintiff if the
settlement includes all claims based upon the allegations for which the insurer previously reserved its position as to
coverage or accepted coverage, regardless of whether the settlement extinguishes all claims against the insured.
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