Whenever any insurer on a policy of liability insurance discovers a breach of the terms or conditions of the insurance contract by the insured, the insurer shall notify the claimant or the claimant's counsel of the breach. Notification shall be given within forty-five days after discovery by the insurer of the breach or of the claim, whichever is later. Whenever, on account of such breach, a nonwaiver of rights agreement is executed by the insurer and the insured, or a reservation of rights letter is sent by the insurer to the insured, notice of such action shall be given to the claimant or the claimant's counsel within forty-five days after that agreement is executed or the letter is sent, or after notice of the claim is received, whichever is later. Failure to give the notice within forty-five days will result in a waiver of the defense based on such breach to the extent of the claim by operation of law.
Notwithstanding the provisions of this section, in any claim in which a civil action has been filed by the claimant, the insurer shall give notice of reservation of rights in writing to the claimant, or if the claimant is represented by counsel, to claimant's counsel not less than thirty days prior to the date set for trial of the matter. The court, upon motion of the insurer and for good cause shown, may allow such notice to be given fewer than thirty days prior to the trial date. Failure to give the notice within thirty days of the trial date, or such shorter period as the court may have allowed, shall result in a waiver of the defense based on such breach to the extent of the claim by operation of law.
1968, c. 410, § 38.1-389.1; 1986, c. 562; 1997, c. 377; 2001, c. 728.
Notes of Decisions
Vermont Mut. Ins. v. Everette, 875 F. Supp. 1181 (E.D. Va. 1995).
· cites it 28× “2-2226 The Virginia Code requires that insurers notify injured third parties of their intent to deny coverage because of an insured’s breach of a policy within twenty days after discovery of the breach or the claim, whichever is later.”
Dabney v. Augusta Mut. Ins. Co., 710 S.E.2d 726 (Va. 2011).
· cites it 18× “According to Dabney, when Augusta failed to provide her or her counsel timely notice of its intention to rely on a defense of Jenkins' alleged breach of the policy, as required by Code § 38.2-2226, [2] Augusta waived its defense based on that breach.”
Angstadt v. Atl. Mut. Ins., 457 S.E.2d 86 (Va. 1995).
· cites it 2× “* Angstadt and the defendants also contend that Atlantic waived its claim of non-cooperation based upon grounds not stated in its disclaimer letter because Atlantic failed to send a copy of its “reservation of rights” letter to the claimant or the claimant’s attorney, as…”
State Farm Fire & Cas. Co. v. Scott, 372 S.E.2d 383 (Va. 1988).
· cites it 2× “1 (now Code § 38.2-2226), State Farm notified Scott of its intention to rely upon the breach-of-notice defense.”
Gordon v. Liberty Mut. Ins., 675 F. Supp. 321 (E.D. Va. 1987).
· cites it 3× “Rossi, pursuant to Va.Code § 38.2-2226, that Liberty Mutual is es-topped from averring that Mr.”
State Auto Prop. & Cas. Ins. v. Gorsuch, 323 F. Supp. 2d 746 (W.D. Va. 2004).
· cites it 5× “Va. Code Ann. § 38.2-2226 (Michie 2002) die- *756 tates that, in order for an insurer to rely on a breach-of-policy defense, the insurer must notify all claimants against the policy of its discovery of the breach.”
Chicago Ins. Co. v. Paulson & Nace, Pllc, 37 F. Supp. 3d 281 (D.D.C. 2014).
“Va. Code § 38.2-2226 (2013). It is undisputed that District of Columbia law does not contain a similar notice requirement.”
State Farm Fire & Cas. Co. v. Scott, 372 S.E.2d 383 (Va. 1988).
· cites it 2× “1 (now Code § 38.2-2226), State Farm notified Scott of its intention to rely upon the breach-of-notice defense.”
Jackson v. Middleton, 90 Va. Cir. 279 (Norfolk Cir. Ct. 2015).
· cites it 10× “This statute governs notice related to discovered breaches in insurance contracts: Whenever any insurer on a policy of liability insurance discovers a breach of the terms or conditions of the insurance contract by the insured, the insurer shall notify the claimant or the…”
Nat'l Cas. Co. v. Solomon (D.D.C. 2020).
· cites it 17× “The Virginia law at issue states: Whenever any insurer on a policy of liability insurance discovers a breach of the terms or conditions of the insurance contract by the insured, the insurer shall notify the claimant or the claimant’s counsel of the breach.”
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